Time for an update on gold…
First, let me say I have just finished selling out my gold shares, for a small loss in one account and a square position in the other. The entire rally from December to March netted me very little. This was because, after buying in nearly perfectly on the bottom early December, I was tossed off because of the fear gold would go to $1050. So I then missed the first half of the rally before getting in. The second half of the rally had me thinking gold was headed to $1420 before a multi-month correction. I was wrong and it topped at $1390 and collapsed, catching me flat footed after it broke the trend line at$1340. Those mistakes caused me to leave a 50% capital gain on the table.
This led me to do a study on gold seasonality and I noticed that for the last 20 years gold tends to rally into March and then begins its weakest period of the year. I am now expecting gold to drift lower into June-July as it makes its way down to its yearly cycle low. Last year’s YCL was vicious and I expect this one to be the same.
Now the rally is broken and the banker-manipulators are back in control. Tomorrow will be golds 200th hit at 2.15 am (US time) in 223 days. You can’t call that a freely traded market. And by the way, gold tanked the day of Janet Yellen’s testimony to congress, as it has done every month for the last six. The big boys want to punish gold and this is their best opportunity of the year.
Gold is now also facing a breakout to new all-time highs in the US stock market. When it rises, gold usually falls from lack of interest. It is also looking likely the US dollar is heading up. This will be turbo-charged shortly when the European central bank begins a round of long anticipated QE to ward off a deflationary crisis in Europe. The picture over there looks decidedly grim.
Due to all these headwinds I now expect we will see the lows at $1180 broken to the downside. Of all the commentators I read, only one correctly anticipated the rally to peter out and the slide to $1050 to continue. For the record his name was Przemyslaw Radomski. I will be following him more closely in the future!!!
Footnote: I have just ordered James Rickard’s new book “The Death of Money” and will give you a review once completed. He is regularly featured on”The Business” TV program on our government television station here in Australia (ABC) so he has credibility. He is expecting another great depression before the end of this decade. I will have a stiff drink before reading it!