Looking Forwards from 7 Months Back May Help Clarify the Fog

Mon, Jul 20, 2015 - 9:18am

I posted this earlier today in the daily Setup For The Big Trade forum blog:

Here is my monthly Comex Gold chart as shown at yesterday's webinar, and showing long term trendlines shown here on setup at various times.

I have updated the monthly chart to include the early trading hours of this week, and the price dump in precious metals.

Note that this move occurred outside high volume Comex open hours, (but it may be sustained later today at these levels we await seeing that).

Note also that the first long term target has been now hit. Thus the minimum decline quantity is "in". The next level is clearly marked - also in highlighted blue - should the gold market make an attempt to get to it. But the time of day and hitting of "a" target are important events for Setup readers to note.

Long term consideration: phase one of the bear may now be complete. Short term consideration: a low is unconfirmed. Continuation could follow to the next long term target as long as time remains for the trend to do so. Of note: long term rising support remains unbroken.

So given the dismay that precious metal holders may be experiencing today in light of the price dump during the Asian session it might be a good idea to make public the Rhythm and Price video newsletter from seven months ago, namely 18th of November 2014.

I'll put it up on Youtube later today, but for readers of TFMR here is the links to the server download right now:

RNP #200 18 Nov 2014 mp4 Big picture gold trend parameters, weekly silver seasonal for end of year

(Later I might edit this entry to change the above link to my YT channel version of same, but it won't be uploaded there until tomorrow AM)

I hope that watching this video from last November will help to gain a better understanding of how bullish or bearish the gold market is at the moment while decline for July 2015 is at hand.

As it happens I do expect the long term (actually medium-long term in my world ...) rising blue support to be tested, but hey it's the markets so nobody knows anything about what might happen next! Only until you watch RNP#200 from last November that is .....

Hopefully you will find that the 14 minutes it takes will be worth your time and helps to gain some perspective. We all need a better perspective these days I believe.

Best of luck to all.


Argentus Maximus

The author posts daily commentary on the gold and silver markets in the TFMR forum: The Setup For The Big Trade. More information about the author & his work can be found here: RhythmNPrice. The author advises that he trades and holds market positions in accordance with his own opinions.

About the Author


Jul 20, 2015 - 9:23am


playing hookey and watching the open

thanks for post


edit...aarrgghhh foiled by Fix

Jul 20, 2015 - 9:23am
Mr. Fix
Jul 20, 2015 - 9:27am


You've got front row seats right here. Pay close attention as history unfolds.

Jul 20, 2015 - 9:49am

GDX has opened down > 5%

Looks like capitulation is the order of the day.

Time to buy silver.

Jul 20, 2015 - 9:52am

As the USD rises

Anything labeled "Commodity" is getting hammered.

Dr. P. Metals
Jul 20, 2015 - 9:55am

Step up right here and get your blue light special

Yes sir ree...get your JNUG special for only $0.99

Offer good only for limited time. Limit one per customer.

Edit: yes we know it will only be $0.50 next week but don't miss your chance today to buy some

Jul 20, 2015 - 10:01am


We were able to spend some time out of town this weekend at our granddaughters basketball games. Oh what fun! I also was able to talk to a real estate broker/property management owner about what he sees in his business.

It was something like : "Real estate sales are not fun anymore. Yes we are making lots of fiat but at a great price. Every transaction is filled with buyer/seller problems and we can work for weeks/months on a transaction and have it blow up over just about anything. The renters these days have credit scores in the 500's and the less expensive units have the biggest problems. From morning to late evening, every day, nothing but problems to solve. I can see that it is time to change my future job and just mow lawns for a living".

I can also see in the home construction arena that the fun has left long ago in building quality homes. The local government agencies have learned how to control everything involved in building a home from the color of the house to the fire alarm systems that must be installed within the homes. They have raised the price of the building permits to the place where the city makes more than the builders.

Many (most) of the old timers who built locally have quit. The regulation, the taxes, the fees, and the continual inspections by the city and state, have driven the boomer builders into retirement and fishing. The entire subcontractor position has been forced to build for cash, as much as possible, in order to survive. The books are cooked if they even have any books. It is very difficult to find anyone who wants to work in the trades within the home construction business. If the Russians and those from south of the border left, the industry would die in a day. If all of these workers actually paid their taxes, along with all the others in other businesses (mom and pop stores and eating establishments) the tax revenue would explode. However, that will not happen as the government has forced these millions of workers into a mode of survival.

Our nation is in trouble and as long as the elected officials sit within their chambers, working to figure out what more they can tax and regulate, they will drive the workforce underground. How will this ever be fixed or will we just become worse than the problems in Athens? jmo Jim

Jul 20, 2015 - 10:07am

Clive Maund fans

His new post says gold to $850 and silver to sub $10.

Jul 20, 2015 - 10:10am

Not the bottom...

Still no one wants to admit it to themselves but it's not the bottom. The warning signs for what is now happening were there and had been for awhile...

I am by no means an expert but if you just look at what I was saying this last month I did my best to warn people of what was coming and there have also been actual experts trying to tell people for a long time now that gold would have to hit the triple digits to resume it's bull... (namely Jim Rogers who said in 2012 Gold would have to hit $900 to $950 to go resume the bull and also Martin Armstrong who actually started calling for sub 1000 gold near the 2011 top).

June 29th:

I felt it necessary to post this all tonight because I really truly do believe we are almost at the bottom of this. Yes, thee fucking bottom we've been waiting for for fucking forever. The bottom that never came in 2012, 2013, or 2014 and that's absence has apparently destroyed marriages as well as portfolios alike. The bottom is actually close and in sight for the first time in nearly a decade. The one caveat to this is that we still need to see THEE washout down into the triple digits for Gold.

How can this be? How can I say the bottom is close and then tell you we need to shave off another $200-250? Because I strongly suspect, as I've been saying here for many months (almost a year now, good lord...), we will see one more final surge in the dollar that will collapse asset prices - otherwise known to Keynesians as deflation - the horror!. In July of 2008 the price of Gold peaked at $980 and subsequently collapsed to $690 by October.

By February of 2009 the price of Gold was through $1000 and by the end of the year it was at $1200.

My point being? The price collapsed 30% in 3 months and then rebounded back to the previous high in 6 months and then nearly doubled from the low in 12 months. When the metals move, they move, and we all know why - because the entire thing is a beach ball being held under water and when the price collapsed to $690 the wholesalers couldn't even keep up with demand and the premiums went nuts. They went through the physical floor because of the liquidity crisis that was created and it made things move violently in a very short period of time in both directions.

It's happened before and there's no reason it can't happen again so by me saying we're close to a bottom, while also saying we need to drop another few hundred dollars, I mean it in terms of time and not price.

The time is close and that's what I mean when i'm talking about the bottom...


July 1st:

Going back to the the idea all things, and markets, work in waves the best we can do is try to predict the general trend going forward. None of us could do anything about April of 2013 because the trend broke and that's just how the wave goes - the same will be true when it flips back up - no matter how hard the bad guys try they will be unable to prevent the trend when it comes back around in our favor.

As hard as it is for many to accept what has been done to these "markets," including gold, is all part of this back and forth process the waves give us. When I back off the day to day, and even the week to week, and I take a long look at the forest through the trees here is what I see:

Considering this chart, considering all the powers against gold and the power of PMs in general, considering the potential strength of the dollar from a euro collapse, and considering that oil - the #1 cost for all mining operations - is still weak and likely to also get crushed under the weight of a soaring dollar then it leads me to conclude that while the bottom is not far off in time it is still very far off in price. This chart SCREAMS to me that the final bottom has still not been found. I feel like at the very least we have to hit 50 where we found the 2010 low but I find more likely we end up somewhere in that box between 0 and 0.

I know that sounds ludicrous, and fundamentally it is, but in a world where Europeans are rushing into the dollar and crushing asset prices - causing a global depression and killing both the demand and price for oil - these numbers do not seem so farfetched.

But again, in this market, all that can be done is to predict the trend because there's too many interventions to attempt predicting price. The trend still seems obvious to me and whether gold bottoms at 0 or 50, or somewhere in the middle at 0, it's really irrelevant where it ends up so long as you don't need to sell what you currently have and understand that the end game is the price blowing through the roof under the weight of a systematic collapse.

I talked about it in my previous long post but i'll point it out on the graph now instead - look at July 2008 to February 2009 where the arrows are pointing - in 3 months the price was cut down nearly 33% and 3 months later it was back to July's high while the rest of the world's economies were in shambles and obviously you can see for yourselves what happened next.

I very much suspect the same exact thing to happen... another waterfall - similar to the one you see in the spring/summer of 2013 - happening in September or October that would take us right into that box and into the 900s (where I really think the bottom will be found) and if it's anything like the July 2008-February 2009 experience we will V ourselves right out of it like a rocket and I strongly suspect by the Fall of 2016 the POG will be well over 2k and likely closer to 00.

I think at the moment Silver is the more interesting watch because we're in the zone now which leads me to believe it will lead the charge again like it did the last time around:

Again, if the scenario I'm predicting plays out and the dollar surges then I think it would make sense that we could see silver fall a little more (12-13$) but because it's already in the zone I think the downside risk is probably less than gold's. Silver seemed to already have it's puke moment right as Oil started to collapse last July.

I certainly can't see what the future holds, only that the trend doesn't bode well for the short term, but the alternative to the V shaped surge we should see starting in 2016 is what happened in the late 80s and 1990s and I think I can speak for everyone when I say I can only hope that doesn't happen.

But what makes gold even more impossible to predict is that if that did happen and we started to see the price in the 400s and 500s we could still end up being the wealthiest people on the block if Oil was $10ish and the Dow was at a 1000ish. There's so many ways gold could end up a winner without the price having to do anything - purchasing power is still the key and always will be so even in predicting a downward trend Gold could still gain against everything else.


July 7th:

Good lord it's at $1020 and nearing sub $1000! Not sure I can ever recall a time gold was this much higher than platinum. It was at $1175 on 5-18.

Edit: Palladium has fallen from $800 to $640 in the same time frame. This is madness.


July 17th:

This has so far played out exactly how I predicted (Euro collapse surges USD and kills Gold). We will not see total capitulation until we've gotten into the 900s and retraced 50% from the top. I've sat here for 10months saying this and have advocated physical cash and my plan remains unchanged. Everything will be on sale this fall and the dollar will top - that will be the time to buy everything you can at fire sale prices, gold or otherwise.

Until then accept that the bottom is close in terms of time. We've waited through years of this shit only a few more months now before the wave flips back.


And simply out of respect I won't repost what I said to SS because I was a little frustrated and harsh but my point is I'M A POT FARMER IN DENVER WITH A MACBOOK AND I SAW IT COMING! For God's sake i'm not THAT smart as it relates to markets and I don't even have a background in finance like some of you do. However, if you accept that 1) All things work in waves so fundamentals do not matter and 2) Gold cannot rise in a deflationary collapse/dollar surge then you start to understand that there are real reasons why Gold is seriously declining and has been for over 4 years now! What we are seeing now has a lot to do with the fact the HUI is at 12 year lows, Barrick is at a 25 year low, the dollar is strong and getting stronger, the Fed continues to jawbone about raising rates this fall, the Chinese just announced a pathetic gold number, and gold is in a 4+ year downtrend that it has yet to flip out of. That's it, that's all.

In 6 months I believe this will all be over but until then we are going to crash and crash hard because when the market shit storm hits this Fall gold is going to get massacred with everything else and all you can do is either sell now (not recommended) or accept it for it is and hang on for the ride (recommended).

Gold WILL explode in 2016 and the bull market will resume. I believe we could see new highs next year but if we don't i'm all but certain we will see them at some point between 2016-18 as gold explodes like it did in 2009-2011.

2015=2008 multiplied by a pretty decent, unknown, factor. That being the case why should 2016-18 be any different than 2009-2011? The wave will persist and when it flips back no amount of short term manipulations by the powers that be will be able to stop it.

Jul 20, 2015 - 10:13am


However, if you accept that 1) All things work in waves so fundamentals do not matter and 2) Gold cannot rise in a deflationary collapse/dollar surge then you start to understand that there are real reasons why Gold is seriously declining and has been for over 4 years now!

I don't accept that, so I won't be read the rest.

Jul 20, 2015 - 10:14am


Silver is till holding. May be not for long. I expect to see a bomb anytime.

Jul 20, 2015 - 10:16am

understand this

its simple

we have all markets manipulated.

we have data manipulated.

we have lies coming from government

the exchanges and most media are complicit in all of this. Anybody honest is vilified.

prepare for the worst.

Jul 20, 2015 - 10:27am

Paging Benoit

Silver is still at $14.7x . Could you please dump some contracts, there is something wrong with Silver in this blood bath. Thanks. Your hedgies.

Jul 20, 2015 - 10:30am


Frankly, I'm a little disappointed in you with that post.

You should have phrased it as, "I'M JUST A DOPE FARMER WITH A MACBOOK", as a closer play off our host's frequent offering. Perfect opportunity, you spent years setting it up, and you missed it by *that* much.


Jul 20, 2015 - 10:31am

A mind set in its ways is wasted.

A mind set in its ways is wasted.

Jul 20, 2015 - 10:32am


That's it! I gotta go take the rest of the day off in shame!

Jul 20, 2015 - 10:35am


Today I capitulated and sold some Central Fund of Canada (CEF) shares that I had held for several years.

I re-deployed the proceeds into some miners:

  • Silvercrest Mines (SVLC)
  • Tahoe Resources (TAHO)
  • Gold Resource Corporation (GORO)
  • Fortuna Silver Mines (FSM)

These are some of the lowest cost silver producers and will be able to make money at $15 silver. They also produce gold, lead and zinc with maybe a little copper in the mix. GORO is paying a 5% dividend. TAHO also pays a dividend.

Other miners I purchased this morning:

  • Seabridge Gold (SA)
  • McEwen Mining (MUX)
  • First Mining Finance (FFMGF)

MUX is a producer that is now paying a dividend. SA and FFMGF are more speculative.

Jul 20, 2015 - 10:36am

The big short

I'm sure most of you are familiar with the book by Michael Lewis. It chronicles the small groups of funds that were short the mortgage market (specifically short CDO's), and the trials that they went through before seeing the payoff.

The most fascinating character in the book, was Dr. Mike Burry. He helped Goldman create the CDS contract on the CDO's, and used them as his prime broker because he knew that they would never be allowed to go under.

Burry commented that every piece of econ data that was bad for housing had the opposite effect on the value of his contracts, and every positive data point went against him as well. He slowly figured out that it was Goldman and the others that were trying to prop up the market while they positioned themselves against it.

I see little difference between what we are seeing in the gold market right now. The big guys are holding down the price, in a desperate attempt to transfer the balance of their short book to the spec funds. When they feel like they have positioned themselves accordingly they will take the shackles off the price, as they will then be able to benefit from them. I see a future where they are long, and refuse to provide the naked shorting paper to the market for the rest of the specs to cover. This will ultimately lead to the blow off in the market that we can't even imagine at this point in time.

Euro collapse? It's gone from 1.40 to 1.05. I think we have seen the collapse already. Fed raising rates will collapse gold price? Look at the last tightening cycle, gold increased by some 60 odd percent.

I don't believe that the paper markets will vanish entirely. The losers in that scenario will be TPTB, and I don't think they plan on vaporizing the vast majority of the wealth and power. I honestly doubt that we will see a reset higher in the near future. I believe if we get that it will be on the heels of an equity and bond market blood bath. I think that will happen, just not in the time frame that most around here are expecting.

Jul 20, 2015 - 10:37am

Metals on sale?


Thank you very much for the article & video. Given last night's action, your timing is much appreciated.

And to think that JNUG was in the $400s not long ago (accounting for the reverse split) and now here it sits below $10. In fact, it was in the $300s this time last year. And I am NOT calling it a buy of a lifetime. In fact, they could do another reverse split and drive it even lower. Talk about a sheep-fleecing operation ...

I sure wish I could trade real mining companies, but alas, I am limited to ETF shares in my retirement account.

Who's retiring here anyway?

Jul 20, 2015 - 10:40am


I quoted your "hook", and it's not sharp enough.

Cycles, Technical Analysis and Fundamentals are all masked by elasticity of paper supply, bending of "rules", and other forms of manipulations.

Saying it's unknowable? fine

Saying everyone's wrong, but the pot farmer has a feeling, err "belief", is just more of the same thing you object to.

In 6 months I believe this will all be over

Saying you know the future based on a hunch falls into the "broken clock" category.

Jul 20, 2015 - 10:49am


...DAMN IT! Red down button's broke (for the moment!)...

EDIT: Don't want to give the wrong impression, I want to buy some more!

Jul 20, 2015 - 10:49am


Hi Jim

I appreciate your comments.

Unfortunately the wheel of progress(?) only rolls forwards, regardless of where that place is or how much anguish resides there.

Jul 20, 2015 - 10:55am

Compare Miner Shares and Silver from Silver Mine X (SMX)

Silver Mine X produces 10 ounces of Silver per day. Every single day. Production never changes. And they only use hand tools yada yada... so their production costs never change either.

But the stock in Silver Mine X (SMX) is another story. It can get shorted, attacked, crashed, etc etc... the bankers can change the rules, leverage this or that, and the SMX stock price goes to ZERO. All while the same employees with hand tools are steadily pumping out those 10 ounces per day. Day after day after day.

Miner Stocks are nothing more than pixels on a screen, and a mistaken belief in the mind of the person looking at those pixels.

Silver is real Money.

Now is the time to transition from pixels to real Money.

NW VIEW argentus maximus
Jul 20, 2015 - 10:58am

@ argentus maximus

Yes, how true. However, that wheel of progress has sunk into the mud of the lives of the many. The wheel has a label written upon it "The weight of time, the crushing of the nations, as mankind has trampled over the freedoms given to him". jmo

Jul 20, 2015 - 11:03am

Nuclear option !

I'm here for a ride. Just bought some NUGT and JNUG. Waiting to buy USLV (but silver is still holding) and TVIX. NO MARGIN, NO MARGIN!!! They are cheap by any standards....even if they go lower from here. I will not look at my portfolio for three months. I'm waiting for Apple to report on Tuesday after market's close (expect another beat) to buy TVIX Wednsday.

Jul 20, 2015 - 11:09am

Don't look now but silver is

Don't look now but silver is up a dime

Jul 20, 2015 - 11:13am

When I see the action in miners

When I see the action in miners and especially the silver miners, I am concerned about Turd's call about Silver. So far last silver low from November has not been broken, but I am wondering if the crooks are not giving some time to break this support in Globex sometimes later. It seems that they can decide the moment they break the market. Silver is GREEN at the moment. For now it's a major failure for the cartel to break the most important metal. Let's see what they do this time. Miners are not following this move.

Texas Sandman
Jul 20, 2015 - 11:14am

Could it be?

A glorious FUBM...

Stackable SS121
Jul 20, 2015 - 11:18am


I bought my first physical silver in 1988. Caught the bottom around 1994. I'm happy with the size of my stack. I disagree about mining shares being pixels on a screen. These companies own real mines and resources and I can purchase a share of their future production for way less than the current price of silver. There are certainly risks, but at these prices I'm very comfortable with the diversification.

And as far as silver being real money, I still need dollars to pay my mortgage, insurance, taxes and to buy gasoline, electricity and food.

Jul 20, 2015 - 11:29am

Fabricated Bottom

Don't legitimize the manipulation as "reality". We are looking at a criminal fabrication in a previously sovereign country where the leadership has chosen to transfer the wealth to the elite while destroying the constitution and case law of a former free country.

We are watching theft and nothing more.

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