As predicted (hoped), both metals found some buying today after a successful test of overnight lows. Silver consistently found buyers near 39 which is right near that upsloping trendline on the 6-hour chart. Gold triple-bottomed at 1705 and has since rallied almost $60. I'd expect these rallies to continue into tomorrow. But, what happens next?
All of this will come to a head tomorrow and over the weekend. Get ready because here comes Ole Turd with another attempt to predict future events!
1) Tomorow is a "risk on" day. The POSX declines and everything else rallies ahead of the Jackson Holedown.
2) Intraday, silver trades as high as 41.80-42.20. Gold reaches 1790. Maybe even 1800.
3) Over the weekend, The Bernank "disappoints" with no QE. Instead, he issues some statements that sound a lot like the last FOMC minutes.
4) Monday is a "risk off" day. The dollar rallies and everything else goes back down.
5) Uh-oh. When the metals roll over from their highs on Friday, the charts conspicuously begin to resemble a head-and-shoulders top.
6) This re-invigorates every douchebag top-caller in the business.
7) Silver declines early next week, perhaps back down to 39.50 or even 39. Gold trades back down to near 1725.
8) This is your buying opportunity. It will take courage to step in and buy at this point but, those who do, will be rewarded.
Of course I could be wrong. Maybe The Bernank will announce a new, massive $2T money-printing scheme to match the new debt ceiling. If he does, you can forget all about the H&S top stuff as it will be off to the races, instead.
Remember, if you're going to survive trading the PMs, you always have to sell some when everyone is buying and you always have to buy some when everyone is selling. You had an opportunity to buy earlier today. You will likely have another opportunity next week. Of course, "sometimes the only winning move is not to play." That's OK, too. Just keep stacking the physical and enjoy the fireworks. TF
