This article identifies and analyzes the realities that have been, and are, affecting the gold market unlike any other article you have ever read on the subject. Get truly informed to better understand what has happened and why and what the future holds for the price of gold and why. Read on and enjoy.
The edited excerpts below come from the newsletter* of Goldrunner (www.goldrunnerfractalanalysis.com) entitled “PIVOTAL MOMENT FOR GOLD – PART II” (WHERE WE HAVE BEEN, AND WHERE WE ARE CURRENTLY) and are posted here (without charts) with permission.
[The following article is presented by Lorimer Wilson, editor of www.FinancialArticleSummariesToday.com and www.munKNEE.com and the FREE Market Intelligence Report newsletter (sample here – register here) and may have been edited ([ ]), abridged (…) and/or reformatted (some sub-titles and bold/italics emphases) for the sake of clarity and brevity to ensure a fast and easy read. This paragraph must be included in any article re-posting to avoid copyright infringement.]
Supply & Demand Realities
There really is no physical gold market. What we have is a paper gold futures market as a false pricing system that allows the supply and demand of paper Gold set the price. That is how the Fed Banks “manage the price of Gold.
The paper gold market is mostly settled in paper money, and only has a sort of side mechanism where historically small amounts of Gold are actually taken delivery of. Thus, if you want to take delivery of Gold from the paper futures market, one must buy a lotto ticket in terms of price and time, and then wait to see if your ticket is in the money on expiration day.
Physical gold supply and demand make little difference if the Fed’s Banks are expanding the supply of paper gold – both in the futures market and in terms of OTC derivatives.
The true fundamentals of supply and demand for physical gold will rule in the end. The fact is that the Fed needs gold to be vastly higher in the end to balance the budget.
Paper Futures Market Reality
…In reality, the paper futures markets are just a false pricing systems to allow the Fed complete management of price in the markets. The Fed cannot allow Gold to go into free-rise prematurely. The fact that the Fed Banks are now leaving the physical side of the Gold market appears to be a sign that we are near a crucial pivot point where Gold will go parabolic to balance the budget. The Fed Banks will still be involved in paper gold to allow management at crucial junctures.
U.S. Dollar Index Reality
The Fed Banks only seriously took control via paper gold once Glass-Steagall was repealed right around 1999/ 2000 into the window where the Fed knew that they would be aggressively printing Dollars. The cycle timing is analogous to the false pricing “Dollar Index” that came into being in 1971, just before the Dollar was going to be aggressively printed. Similarly, the Euro Zone was born around 1999, probably to tie the European currencies together as a means of control under the paper currency indices. Suddenly, about 60% of the ratio…[component] of the U.S. Dollar Index was tied together conveniently in the false pricing system for the U.S. Dollar.
Quantitative Easing Reality
The talk over who the next Fed Chairman…[will be] is unimportant. The Fed’s board is almost entirely made up of European Banking cartels. They make all of the decisions. They have huge risk both in the States and in Europe if they do not continue to aggressively print. The bottom line for all Western Countries is that either they print and devalue their currencies, or they face the wrath of Deflation. They will print.
PM Stocks Valuation Reality
A rating agency came out and said that they never raised the expectations for the PM Stocks because they never raised the expectation for earnings above a $1300 level for Gold. The Street does not raise expectations for higher Gold prices until Gold has retraced back to its “last high.” Nowhere in the markets do you see anything like this except in the Precious Metals Sector. Boy, are they going to be dead wrong one day in the near future. Once Gold goes parabolic, the price valuations for the stocks will start to reflect reserves more than earnings, anyhow.
Price Movement Realities
Per the 70’s, we had expected the rise in Gold up to the $1920 top with a subsequent decline in price per the late 70’s Gold Chart. The 70’s analogy suggested that after that decline the Fed would remove their clutches on Gold to allow it to start a more aggressive rise to equate to the late 70’s first true parabolic run, higher. We expected to see Europe start to aggressively print to allow the Fed to ramp up the Dollar printing as the Fed Banks defaulted on the European Bank Debt OTC derivatives yet Europe stared into the face of austerity without printing. This left the Fed’s Banks suppressing the price of Gold via paper gold. Central Banks came in to heavily accumulate physical Gold at the bottom. In the end the Fed Banks took Gold down rather than to risk Gold busting up into free-rise. No doubt they used the move to cover their shorts.
The above suggests that Europe not printing was the issue, solved via paper gold supply. Thus, there is no real road block to Gold moving sharply higher with the Fed’s Banks short positions out of the way when Europe ramps up the printing presses.
For the moment, GOLDRUNNER (Email me at GOLDRUNNER44@AOL.COM with your questions and comments; Goldrunner offers a subscription service which provides detailed technical analysis of where the price of gold, silver and precious metal stocks are going in each stage of their respective bull runs. This service comes with detailed charting based on conventional technical analysis and his proprietary fractal analysis based on the ’70s. Go here to subscribe.)
Please understand that the above is just the opinion of a small fish in a large sea. None of the above is intended as investment advice, but merely an opinion of the potential of what might be. Simply put: The above is a matter of opinion and is not intended as investment advice. Information and analysis above are derived from sources and utilizing methods believed reliable, but we cannot accept responsibility for any trading losses you may incur as a result of this analysis. Comments within the text should not be construed as specific recommendations to buy or sell securities. Individuals should consult with their broker and personal financial advisors before engaging in any trading activities. Do your own due diligence regarding personal investment decisions. In the interest of full disclosure, GOLDRUNNER is personally invested in the Precious Metals sector including various Precious Metals and other individual stocks. GOLDRUNNER reserves the right to modify or eliminate any or all positions at any point in time.
[Editor’s Note: The author’s views and conclusions in the above article are unaltered and no personal comments have been included to maintain the integrity of the original post. Furthermore, the views, conclusions and any recommendations offered in this article are not to be construed as an endorsement of such by the editor.]
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