Friday , 9 December 2016


Noonan: “Charts say gold & silver aren’t going higher – for now!” Here’s Why

…As individuals, we cannot control what goes on.  All any individual canfine silver fine gold do is be in control of him/herself and act in one’s best interests.  The globalist’s financial world is spiraling out of control.  People have as many warning signs as they choose to see, yet most choose not to see because it goes against the lies they have come to believe as truths…Our focus, however, has to be on protecting our financial self-interests as best as can be done in a growing tsunami of uncertainty.  The most reliable and proven certainty, in a financial sense, remains gold and silver.

By Michael Noonan (edgetraderplus.com)

…All that matters is physical gold and silver.  As with paper, the price of physical PMs also has been going down.  Those who choose to measure the utility of owning gold and silver in terms of price alone have lost a sense of their true utility, a storage of wealth.  There are times when the “store of value” is negative.  The cost of insurance is negative, so why carry any for self, home, car, etc?  Insurance has no value if it is never used, yet people have it all the time.  Why?  Because they do not know when it will pay off to have it.

In the final analysis, one either believes gold and silver are a valuable form of insurance, or not, and any form of sophist reasoning does not matter.  We choose to appreciate the value of gold and silver throughout history, and we recognize there are and have been times when holding them was a losing proposition, albeit temporarily.

The gold:silver ratio has reached 78:1, last week, vacillating between 75:1 and a little higher.  For this reason, we favor silver over gold, even exchanging gold for silver.

The charts may not show a turnaround, at this point, so the when question remains in play, but so does the why question, as in why own PMs?  History favors the why, and so does the future.  We continue to recommend the purchase only of the physical PMs.

The Charts

The charts show the ongoing and uncertainty of being able to answer the when.  All we can say is, it just is not yet.

Time to show the annual and quarterly charts, not for timing, but because they show as true a picture of developing market activity as smaller time frames in terms of persistent direction.  

Gold: Monthly Chart

Right now, a potential for change is absent, so there is no definitive answer for when.

GC M Jan 16

Gold: Weekly Chart

The chart below gives an indication of a still weak market and why the probability for lower prices is greater than not.

GC W 9 Jan 16

Gold: Daily Chart

The closes in the chart below are all mid-range to lower on each bar, and that tells us sellers are stronger than buyers, so continuation lower is the most likely outcome.

GC D 9 Jan 16

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Silver

It does not matter how much [one] wants to embrace the strong fundamentals favoring silver, the charts reflect current market assessment, and all participants know all that is to be known about the fundamentals, and price is still making lower lows and shows no ability to rally.

Here is how the message from the market is clear and simple without being misleading. Facts are facts, and the logic is irrefutable.  The same cannot be said of opinions, so ignore them and deal with what is.

Silver: Monthly Chart

Here is the proverbial picture worth 1,000 words.  Scan the chart below from left to right. One does not have to be much of an analyst to conclude the market direction and determine there is no visible sign of change.  While the when remains unanswered, you have a definitive answer that it is not right now or even in the immediate future.

SI M 9 Jan 16

For the past three years, the charts have not mislead anyone who takes even a cursory look to see where price is and has been headed.  Fundamentals, for however real and accurate they may be, have been misleading all throughout this down trend.

Anyone who says charts cannot be relied upon does not know how to read them and is not a source that has validity, just an idle opinion that is consistently wrong.

Silver: Weekly Chart

Whenever you see sideways activity that is under a previous sideways move [as in the chart below], odds favor the current activity is weak and will lead to lower prices…

Also note how price fails to even approach a 50% retracement, clearly a sign of ongoing weakness.  These are two indisputable facts about which no reasonable person can disagree…

SI W 9 Jan 16

Silver: Daily Chart

Reading charts is not rocket science.  It all comes down to facts and applied logic which are highly reliable.  The bear trap rally, identified on the chart, was a legitimate place to buy, based on developing market activity.  However, once it failed, one had to bail out and  take immediate loss.  It happens.

SI D 9 Jan 16

Conclusion

For all the information the above charts convey, it is not unfair to suggest price is likely to go lower, nor it is unfair to expect anyone armed with this knowledge to be disappointed that gold and silver are not going higher, for now.  

For all the reasons given, expecting price to rally would be an unreasonable position to take, and one that takes no sense…

[The original article was written by Michael Noonan (edgetraderplus.com) and is presented here by the editorial team of munKNEE.com (Your Key to Making Money!) and the FREE Market Intelligence Report newsletter (see sample here sign up in the top right corner) in a slightly edited ([ ]) and abridged (…) format to provide a fast and easy read.]

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