The Metals Manipulators Are Being Manipulated

For those that follow me regularly, you will know that I have been tracking a set-up for the SPDR Gold Trust ETF (GLD), which I analyze as a proxy for the gold market. I also believe that gold can outperform the general equity market once we confirm a long-term break out has begun, and I still think we can see it in occur in 2018. This week, I will provide an update to GLD. While I have gone on record as to why I do not think GLD is a wise long-term investment hold, I will still use it to track the market movements.

But, before I give you my broad view of the GLD, I just want to make a point about silver.

For years, it has been “explained” to me that when the metals are beaten down strongly, it is a clear indication of manipulation. After all, metals are only allowed to rise based upon these people, otherwise, it is clearly manipulation.

Those that maintain this perspective point towards the Commitment of Traders’ report and highlight the segment of the market to which they are certain represents the “manipulators,” especially since they have carried large short positions for quite some time. Well, when it comes to silver this week, they have either been presented with a situation which completely invalidates their perspective, or they will simply don their blinders and continue on their way. (Most market participants choose the latter).

You see, the “manipulators” have seen their short positions drop to the lowest point since they have been tracking this information. Yet, the silver market experienced just as strong a beat down on Monday as it experienced in its rally last week.

So, does this mean that these people really don’t control the markets? Heaven forbid we should even utter such blasphemy. The gods to which GATA and its followers pray will strike me down with lightening for even considering such foolishness.

And, if I should even proffer the potential that the manipulators are being manipulated themselves, then the ground will likely swallow me up as it did Korach and his followers in the bible.

If the manipulators supposedly manipulate the market, but then the manipulators are being manipulated, what does that mean? I guess we have to ask what does it mean when we come across a double negative? Ahhh . . yes. It equates to a positive. I guess that really means there is no manipulation in the metals market. (smile).

As far as the GLD is concerned, upper support is 123.58. If this pullback can hold over that level, and then break out over 129.47, we have a very powerful set up which should catapult us at least to 138.26, and potentially well through that quite quickly.

However, if we are unable to hold the 123.58 level, then it becomes likely that we will retest the 120-122 region before we are able to develop this break out set up again.

See chart illustrating the wave counts on the GLD.

Avi Gilburt is a widely followed Elliott Wave technical analyst and author of ElliottWaveTrader.net (www.elliottwavetrader.net), a live Trading Room featuring his intraday market analysis (including emini S&P 500, metals, oil, USD & VXX), interactive member-analyst forum, and detailed library of Elliott Wave education.