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Ultra-Bullish Trends In Precious Metals 5 1/2 Year Downtrend Line War

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June 1, 2017 - 2:05pm

In yesterday’s must listen podcast with Kerry Lutz, I cited last week’s “historic market manipulation setting the stage for catastrophe” article, to emphasize that manipulation is the only reason the world is not amidst “history’s most overdue financial crisis.”  Which in turn, would annihilate the “dotcom valuations in a Great Depression Era” that have inadvertently been created; whilst simultaneously, yielding the “rise of real money,” as the Gold Cartel is inevitably – and likely, irreversibly – destroyed.

At this point, anyone who doesn’t realize – and admit – this, is either lying or compromised, given how blatant the attempts to manipulate financial markets, economic data, and even elections have become.  I mean, what part of the “dead ringer” algorithm, propping the “Dow Jones Propaganda Averageevery day for at least the five years since I first described it, can anyone possibly miss?  Yesterday alone, the dollar and interest rates closed at essentially their post-“Trump-flation” lows; whilst a swarm of hideous PiMBEEB news of all sorts engulfed the airwaves, such as…

  1. James Comey will indeed testify to Congress that Donald Trump attempted to obstruct justice next week
  1. Yet another post-OPEC “production cut deal” oil plunge
  1. Collapsing mortgage applications and pending home sales data (c’mon Janet, I dare you to raise rates)
  1. China’s manufacturing PMI “unexpectedly” plunged to a recessionary 6, whilst the “Google of China,” Baidu, was “unexpectedly” downgraded by Fitch due to its exposure to China’s imploding “shadow banking industry.” Or, as Jim Rickards causes it, “the greatest financial bubble in history.”
  1. Due to exploding store closures, amidst the horrifying, irreversible “retail Armageddon,” Credit Suisse analysts forecast that 25% of America’s 1,100 malls will close in the next five years.
  1. Reports that the Memorial Day weekend movie box office was the weakest since…drum roll please…1999.
  1. The Fed’s own Beige Book economic survey reported weakening economic activity in nearly all U.S. regions
  1. Trump’s (rightful) rejection of the Paris Climate Change Accord further alienated the U.S. from the rest of G-7, to the point that Angela Merkel essentially claimed she could no longer trust America
  1. JP Morgan, which can do no wrong in its plum role as government partner-in-crime, pre-announced a massive, 15% year-over-year decline in trading revenues – caused, of course, by the historically low volatility created by the aforementioned, historic, government-led market manipulations.
  1. The governor of the Bank of Italy said Italy’s major banks would take an $11 billion cumulative write-down if they sold their $22 billion of non-performing loans at market prices
  1. The EU stepped up its aggressive BrExit “negotiation tactics,” setting the stage for political and economic war between the UK and EU. This, as polls regarding the upcoming UK “snap elections” unexpectedly showed that Prime Minister Theresa May will NOT have enough votes to form a majority government.
  1. Relentless reports of U.S. political dysfunction, including the bombshell Comey testimony report; news that Obama Administration officials have been subpoenaed for spying on the Trump campaign; and I kid you not, Nigel Farage was named a “person of interest” in the ongoing “fake” investigation of Donald Trump’s fictitious collusion with the Russians.


But hey, when you have PPT’s – U.S. and foreign – buying stocks with “dead ringer” algorithms every day, the temporary perception that nothing can go wrong can be created.  See below’s charts of the last three days, with stocks bottoming each time at the time of the Fed’s 10:00 AM “open market operations.”

Consequently, stocks can be made to “rise” no matter how bad the news…

…to the point that historic asset bubbles have been created – enabling Zero Hedge to publish surreal trading postmortems, like yesterday’s “NASDAQ shrugs off commodity carnage, retail crash, to post longest win streak since 2009.”

Heck, the powers that be were so desperate yesterday, they actually revised the hideous Chicago PMI number reported at 9:45 AM EST (note the pre- “open market operations” time stamp) when markets initially – God forbid – plunged; from a much lower than expected 55.2 to a three-year high of 59.2.  This, despite every imaginable “hard data” report screaming recession, and most “soft data” as well.

That said, even yesterday’s blatant data fraud – which by the way, is not the first time this has occurred – doesn’t hold a candle to this morning’s; when first, a desperate OPEC, seeing oil prices again plunge toward $48/bbl, put out a “fake news” headline that it may consider a deeper production cut at its meeting six months from now.  Topped only by ADP reporting a much better than expected May jobs number of 253,000 (seasonal adjustments and data fabrications notwithstanding; as well as the fact that ADP reports typically have little or no correlation to NFP job reports, and are often dramatically downwardly revised), just 45 minutes after the third worst Challenger Job Cut Report of at least the past five years!

And of course, Precious Metals’ gains were capped, capped, capped – from the second “markets” opened Tuesday morning, amidst the aforementioned, wildly PiMBEEB news tsunami.  Not to mention, reports that two of the world’s largest gold producers, Australia and China, experienced massive year-over-year production declines in 2017’s first quarter, of a whopping 8% in the former, and 9% in the latter.  In other words, confirming what I posted in December’s “most important, and gold bullish, chart you’ll ever see”; i.e., even mainstream analysts are now projecting a 20%-25% gold production decline in the next eight years or so.  This, whilst Central banks are on the verge of setting unprecedented money printing records, as history’s largest, most destructive fiat Ponzi scheme spectacularly implodes.  Which hasn’t been lost on hedge funds, which last week bought their most gold futures since 2007.

Which leads me to today’s extremely important topic, of the “ultra-bullish” developments in Precious Metals’ ongoing 200 week moving average and 5½ year downtrend line wars with the powers that be.

Regarding the former, I must again emphasize that I am not speaking of gold’s and silver’s 200 day moving averages, but 200 weeks – which both metals bullishly traded above from 2003 until the Cartel’s vicious “alternative currency destruction” raids of April 2013.  Gold recaptured this level last month, which currently stands well below today’s price, at $1,240/oz.  Due to otherworldly Cartel attacks; in its fear that the extremely tight physical silver market will explode, silver has not been able to maintain the upside breach of its 200-week moving average it temporarily achieved last month.  However, it is still in “shouting distance” of this level, at $17.90/oz; and in the process of such hideous Cartel raids, the silver/gold ratio has become, in my very strong view, more undervalued than at any time in history.

As for the 5½ year downtrend line, going back to the Cartel’s hideous “Sunday Night Paper Silver Massacre” in May 2011 – when silver was on the verge of taking out its nominal high of $50/oz from January 1980; and “Operation PM Annihilation I” in September 2011 – when dollar-priced gold hit an all-time high of $1,920/oz; I believe traders are far more focused on this major technical resistance level than even the 200-week moving average.  In gold’s case, this level is just $1,277/oz, barely above current levels; whilst in silver’s case, I was just alerted last night that its 5½ year downtrend line has already been breached, given that it lies at just $16.30/oz.

In other words, amidst the most Precious Metal bullish fundamental environment imaginable – on the political, economic, social, monetary, and supply/demand fronts – even the Cartel’s best efforts to delay the inevitable re-emergence of the only real money the world has ever known are failing in the historically rigged financial markets.  These “ultra-bullish developments” will be nearly impossible to reverse in such an environment – yielding a dramatically increased likelihood that the Cartel’s two-decade reign of terror is nearing its inevitable end.  And when it does, if you have not already purchased, and safely stored, your physical gold and silver, it may already be too late.

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About Andrew Hoffman / Media Director

Andrew C. Hoffman, CFA is the Media Director at Miles Franklin Ltd. Call 877-685-4705 or email ahoffman@milesfranklin.com, visit www.milesfranklin.com

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