Supply & Demand

The dollar will rally for 6-8 weeks while gold heads lower. Gold has decisively broken down through its 200 dma. Traders are in a bull market mentality and will try to buy gold’s dips until sentiment becomes bearish.

Gold has closed below its intermediate uptrend line. This is the first confirmation that a larger intermediate degree decline has begun.

A well-known coffee company says, “Respect the bean”. That may be good advice, but I think it’s vastly more important for gold and silver bugs to “Respect the bar”!

As we reach the final stages of the current economic cycle, hubris is prevalent everywhere. Central bankers and bankers believe that they can continue to create wealth by printing and borrowing money. Since it has worked so well for 100 years in this latest cycle, why can’t it continue?

Gold’s intermediate cycle low is still 6 to 8 weeks away.

According to Goldman Sachs, central banks now hold a full third of the world’s bond market.

Since January 1999, when LBMA prices traded at 250.90 in euros, gold has seen a compound annual growth rate of some 8.7% compared to 5.4% for the DAX, 1.5% for the CAC 40 and around 0.15% on the Eurostoxx 50, using monthly data and closing prices from May 31.

It’s time for oil to rally a bit and for gold to move down into an intermediate cycle low.

One/some/several “entities” decided at 9:38 a.m. this morning that it was necessary to dump 14,315 contracts of paper gold. This is just the August contract. In total a lot more was unloaded. This represents 1.43 million ozs of gold.

After pleading guilty to fraud charges last week and agreeing to cooperate, Liew has become a prime government witness for U.S. prosecutors investigating whether traders at the world’s biggest banks conspired to manipulate prices in silver, gold, platinum and palladium.