Gold: Chasing Price Feels Very Nice!
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It’s rare that I suggest that gold market investors should engage in “price chasing”.
The 1970s were a time to do it. So was 2009.
What about today? Today, the answer is… yes!
When price rallies to the neckline of the largest bull continuation pattern in the history of the gold market…
Simply put, it’s a time to chase price!
The short-term gold chart. Investors must adjust their thoughts and actions to reflect the current technical reality of the gold market:
It’s now very similar to the 1970s. Daily swings of $40, $50, and even $100 are the “new normal”. The good news is that all that’s needed to deal with these swings… is a yawn.
It’s a time to put the space helmets on, and…
Unfortunately, it’s also time to understand why this is happening.
The 2021-2025 time zone is potentially the biggest war cycle since 1941-1945.
A huge number of war cycles are converging, and I cover them in detail in my daily big picture newsletter where I cover gold, silver, commodities, stocks, and rates. At $199/year, my subscribers’ biggest criticism is that my pricing is too low. Regardless, I’m offering a special $179/15mths war cycle special this week. Please send me an email if you want to get it. Thanks!
For now, Ukraine dominates the war cycle action, but that will likely change, and most of the blood spilled could soon be on US soil. For Americans, the converging cycles are both global and civil.
Cyber attacks are increasingly likely. These attacks could come from Russia, China, or even from the US government in a “false flag” operation.
Ironically, gold bugs are worried about the increase in price volatility in the mining stocks, when they should be ensuring they have food, medicine, water, cash, and physical metal to deal with cyber warfare attacks. The bottom line:
Gold price volatility is best handled with a yawn and a laugh. That’s not the case for war cycle volatility in our daily lives.
From the early October low, I’ve warned US stock market investors that a H&S top was likely forming, and it did.
Now the neckline is failing, and that’s just one of a myriad of ominous indicators.
The CAPE ratio for the S&P500 is in the stratosphere and still above where it was the highs of 1929! QE is finished, a boatload of rate hikes is required to reverse inflation, and cyber attacks may be imminent.
Clearly, the stock market freight train appears “scheduled” for a one-way trip… to Hades.
What about the miners? Well, if the markets remain open, it should be clear sailing for most of them.
The key GDX chart. A massive bull wedge pattern is in play, but note the rallies from 2008 and 2020 highlighted in red.
The game has changed. Rallies since 2008 were themed on QE welfare programs and rate cuts. Most of the money went to stocks, bonds, and real estate. Now, gold stocks are rallying while rates rise, QE is ended, and the stock market crashes. This is a new paradigm, and it is awesome!
The fabulous GOAU chart. Note the bull flag and the significant rise in volume. Institutional money managers are beginning to put proceeds from their stock market sales into the precious metal miners.
Gold and silver stocks will have sharp pullbacks, but these should be short-lived. This is a time when both dip buyers and momentum players can thrive. It’s a time to buy dips. It’s a time to chase price. It’s a time that is best labelled… very, very nice!
Special Offer For Gold-Eagle Readers: Please send me an Email to [email protected] and I’ll send you my free “Gold Stocks Under Two, And Silver Stocks Too!” report. I highlight ten gold and silver stocks trading under $2 that I consider “must own” for eager investors. Winning buy and sell tactics are included in the report!
Stewart Thomson
Graceland Updates
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Stewart Thomson is no longer an investment advisor. The information provided by Stewart and Graceland Updates is for general information purposes only. Before taking any action on any investment, it is imperative that you consult with multiple properly licensed, experienced and qualified investment advisors and get numerous opinions before taking any action. Your minimum risk on any investment in the world is: 100% loss of all your money. You may be taking or preparing to take leveraged positions in investments and not know it, exposing yourself to unlimited risks. This is highly concerning if you are an investor in any derivatives products. There is an approx $700 trillion OTC Derivatives Iceberg with a tiny portion written off officially. The bottom line: Are You Prepared?
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Stewart Thomson is president of Graceland Investment Management (Cayman) Ltd. Stewart was a very good English literature student, which helped him develop a unique way of communicating his investment ideas. He developed the “PGEN”, which is a unique capital allocation program. It is designed to allow investors of any size to mimic the action of the banks. Stewart owns GU Trader, which is a unique gold futures/ETF trading service, which closes out all trades by 5pm each day. High net worth individuals around the world follow Stewart on a daily basis. Website: www.gracelandupdates.com.
