from Silver Doctors:
SD Outlook: After getting pummeled on Friday, gold & silver are looking for a bottom. Here’s the details…
On Friday I put up that dramatic spiking gold to silver ratio over a short time frame.
Today I’ll show what the GSR looks like on the standard chart we have been following for some time:
Now that is a dramatic move, but noticed how nothing really has changed.
The spike did not put in a higher-high, but rather, a lower-high (assuming the intra-day high of 79.29 holds). So the trend is still in place. As gold & silver rally, the ratio will be coming down for the right reasons (meaning that both gold & silver are moving higher in price).
Overnight and into this morning we see a bounce forming in silver:
I’m not convinced, however, that the one day drop is the low.
In fact, I’m looking for lower prices this week.
Now, I know “past performance is not indicative of future results”, but last year, from late June until the 10th of July, silver was taken behind the woodshed. It had some pretty big beat downs, and with the “summer doldrums” that everybody has been conditioned to accept, it seems as if the cartel will just strong arm silver towards the lower end of silver’s current range.
That would be $16.20.
I wouldn’t put it past the cartel to smash as hard and as fierce as they can to knock silver all the way down to a 15-handle.
Think about it this way: Silver has been in the sideways channel of pure agony since February 2nd. We know silver is going to break out of the channel. What better way for the cartel than to have a false break-out on the charts, followed by a total break-down into the $15s.
I’m not sure if they’ll be able to pull it off, but I’m sure they’ll try.
That was the December 11th low in silver before the rally. We really need that level to hold.
There’s something rather ominous the cartel is attempting with gold:
If they are able to strong arm the yellow metal some more from here, they will be able to work in a “death cross” where gold’s 50-day moving average crosses the 200-day moving average to the downside.
The only problem is to do that, gold is going to be screaming “oversold”.
That said, if they’re going to put the pressure on silver, they’re going to put pressure on gold as well.
The other two precious metals aren’t even showing what looks like a bounce (not that I’m expecting gold & silver’s overnight bounce to hold).