Tag Archives: gold bull market

Russia To Supply China With Up To 100 tonnes Of Gold Annually

Russia’s second largest bank, VTB Bank, announced a deal to supply Russia with 12-15 tonnes of gold in the next 12 months.  The amount supplied will increase over time and eventually reach 80-100 tonnes annually:  Reuters Link.

Perhaps the most interesting aspect of this will be to see if the World Gold Council acknowledges this gold as “Chinese imports.”   The WGC and other entities which purport to track global gold “consumption” have been reporting declining demand for gold in China, based on declining imports from Hong Kong.   Of course, these “official” sources completely ignore the fact that China imports an unknown amount of gold through the ports of Beijing and Shanghai…move along, nothing to see there…

The unarguable scheme by western Central Banks to suppress the price of gold with paper gold is contingent on the ability to deliver actual physical gold into China and India.   In this blog’s educated opinion, the supply of gold available to make this happen is running low:  Central Bank gold stock plus investor custodial gold that has been hypothecated.

This report out of Russia supports the thesis that China’s Central Bank is accumulating, and has accumulated, significantly more gold than it is willing to disclose.  As reported in the South China Morning Post when China announced opening Beijing, after also opening Shanghai,  for gold imports:

Opening the capital as the third shipment point will help the PBOC keep purchases discreet as it is believed to be adding to its bullion reserves…The mainland has begun allowing gold imports through the capital, sources familiar with the matter said, in a move that would help keep purchases by the world’s top bullion buyer discreet at a time when it might be boosting official reserves.  South China Morning News

This is likely why the Fed/ECB/BOE are collectively having a difficult time pushing the price of gold lower after its big move starting in mid-December.   At some point, gold is going launch out its current lateral consolidation and move much higher by the end of the year. Especially once the market fully understands that the ONLY policy choice left for the Fed is to keep printing money at an accelerating rate or risk complete financial collapse.

Gold And Silver Are Headed For New Highs

I’ve  been pounding the table since late January that the third leg of the gold and silver bull market had started in mid-December.  It’s also been quite clear to me that the western Central Banks had lost their ability to push the price of gold/silver down.  Now the best they can hope for is to maintain a “controlled retreat” – i.e.  do what they can to limited rate at which the metals move higher.  That’s why we get these “zip line” price plunge formations followed by another “stair step” higher.

But don’t take it from me.  Andy Hecht, a famed oil trader, had this to say:

“I have been trading precious metals since 1981, and I have never seen an environment where both the technical and fundamental states of the metals have lined up as they have in 2016. I believe that we may be in the early days of a rally that will take gold, silver, platinum and palladium to new all-time highs.”

I need to point out that earlier this year Hecht was slow to accept the move being made by gold and silver and had even issued some bearish remarks at one point.  You can read his full commentary on the metals here:  Gold/Silver Are The Place To Be. (He has the same graphs I was showing 6 weeks ago).

The silver mining stock I featured in the debut issue of the Mining Stock Journal is up over 7% this morning.  It handily beat earnings.  This is the only large-cap miner I have presented.  It’s nearly doubled since early March and the Company pays a monthly dividend.  The call options I recommended are up 260%.   Another stock I recommended in mid-April popped 60% earlier this week. I’ll note that Casey Research had recently “poo-poo’d” this stock. My Mining Stock Journal focuses “off the beaten path” ideas that are higher risk/very high return juniors.   You can subscribe to the MSJ here:  Mining Stock Journal.   The subscription price includes all the back-issues (for now).

Buy Every Price Hit In The Metals And Miners

Eric Dubin (The News Doctors) and Doc or Silver Doctors, SD Bullion invited me on to their weekly Metals and Money Wrap last week.  We discussed signs that show the gold/silver manipulators are losing control of their ability to control prices, the record amount of paper being thrown at gold and silver on the Comex, the current seasonal “lull” in the precious metals market and the latest developments on Japan’s TOCOM futures exchange which could have a big effect on the price of gold and silver.  In short, we discussed why investors should be adding their positions on every price drop:

In fact, silver and gold were hit hard overnight last night (Sunday night, early Monday morning) and silver is now 40 cents off its low of the day and green vs its Friday close and gold is $8 dollar off its low of the day. Click on the link below to find underfollowed junior mining stock ideas with huge upside potential:

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SoT Market Update: The Fed Fails And Gold Glitters

In this installment of the Shadow Truth’s Market Update episode, we discuss the FOMC’s unwillingness and inability to raise interests even 25 basis points, the 2008 financial collapse redux, and that fact that gold is “sniffing out” a catastrophic market event on the horizon.

SoT Market Update: As The U.S. Tries To Destroy The World, It Will Destroy Itself

Except for its western hemisphere lap-dogs and chattel, the U.S. “defense” strategy has been the implementation of a highly “offensive” (in both senses of the word here) policy of military and economic antagonism. What unfolding of events in Syria and Venezuela are just two examples.

As the U.S. Ponzi scheme continues to unravel, the Government’s attempt to control the markets intensifies. The primary stock indices (Dow, S&P 500, Naz), which are currently more overvalued than at any point in U.S. history, seem impervious to any sort of sell-off, no matter how atrocious the economic news. The stock market has been “miraculously” bullet-proof from the most recent Fed official threats to hike interest rates in two weeks.

Conversely, the price of gold, has been subjected to paper gold price slams nearly every day since the Federal Reserve’s Club of Thespians released their latest sequel to “Game Of Rate Hikes.” It’s like “Chuckie” in the “Child’s Play” series – the storyline just won’t die.

The current manipulated pullback has taken gold down about 7% since the “Game of Rate Hikes” was released about two weeks ago. India has been dormant as a gold buyer since March 1st, activity seems to be stirring based on the latest ex-import duty premiums. Smuggling into India has picked up considerably this week – LINK. Similarly, buying in China per data from the Shanghai Gold Exchange has been stimulated by the lower price of gold.   In fact, deliveries onto the SGE have surged this week and the open interest now sits at 720 tonnes, which is likely a record.

The only result that will end up being accomplished by the U.S. intervention in the gold market will be a further transfer of real wealth from the U.S. populace to the Chinese. Thank you may I have another? Rory Hall and I discuss these issues in our latest “Market Update” series from the The Shadow of Truth:

Gold And Silver Are Being Bought On Every Manipulated Hit

In  real terms, most international fiat currencies could come to be near valueless when measured against gold and silver…And of course that climate will cause the utter collapse of the global stock markets, not to mention impact most severely our societal stability;  all as direct consequence of the delusionary monetary practices employed for decades.  – Safewealth newsletter

Sell please. I’m buying. There’s a lot of analysis out there with highly flawed assumptions. The biggest problem with this analysis – Seeking Alpha link – is that the author assumes the Fed will raise interest rates. That won’t happen until the entire is system is forced into a reset from a collapse. The Fed knows this and has no interest in hastening that reset.

Just like the continuous threat of raising interest rates, there’s been a continuous threat of Untitled“gold is overbought, too many longs, market is going to cliff-dive at any moment” like this article pouring forth (click to enlarge image). Where was this story-line when gold was being hammered daily as if the market was trying to dig a hole to China for the price of gold?

The gold net long is “stretched?” That meme is now quite tired. Put it to sleep please. Analysts with a longer track record in this sector than the author of the above article have been instilling the “net long” fear into the market for nearly three months now. Where’s this overbought sell-off?

Untitled1They key to finding profit opportunity is to think outside the box. Based on my findings, there is a lot of institutional cash on the sidelines waiting to buy into the pm sector on any pullback. That’s why the metals have popped after that manipulated take-down on Monday – a takedown fueled by the “net long is overstretched” commentary that littered the airwaves last Friday after the COT report was released. (click image to enlarge)

This market has been surprising everyone to the upside and will continue to do so. At some point the lemmings who blindly soak up the “market is overbought” fairy tale will be running to catch the train. That’s when the real fun begins.

Currently gold is behaving similarly to the way it behaved back in 2003 when it was tryingmining-stock-journal-banner punch through $400. The “overbought” garbage was permeating the media back then just like now. In fact, Robert Prechter issued a call for gold sell off to $50. How’s that call look? Shortly thereafter the market blew through $400 and eventually hit $1900. I would suggest that the author in the article linked above was not around back then and thus has no context for what is happening now.  (CLICK ON THE IMAGE TO THE RIGHT TO ACCESS IRD’s MINING STOCK JOURNAL)

The Precious Metals Are The Market Story Of The Year So Far

“Short gold on market overreaction”Jeffrey Currie on CNBC on Feb 16, 2016;   CNBC host:  “Is there any commodity that you can recommend to help our viewers make money?”  Jeffrey Currie:  “Short gold”CNBC on April 5, 2016;

Goldman Sachs’ Jeffrey Currie has become the “Jim Cramer” of the gold market (click on graph to enlarge).  When heUntitled issues a table-pounding call, do the opposite.  When gold was approaching its bottom around the $1050 level, Currie’s price target was $800.   Much the same way Wall Street banks like Goldman, with AAPL at $96 and down 27% since July have been forced to lower their price target from $200 to $150, Currie was forced to raise his price target for gold to $1080.  And he’s still pounding table with a “short gold” advisory.   I guess when he receives a taxpayer-subsidized seven-figure bonus every year, he doesn’t mind looking like a total idiot with regard to the market.

To be sure, there’s several developments that warrant designation as the market story of the year so far.  The shocking performance of the stock market would likely get the nod except for the now-obvious fact that the Federal Reserves continuous intervention is the force behind the stock market’s buoyancy.  In relation to the true underlying fundamentals, perhaps the only two markets in history that have been more irrational are the Dutch tulip bulb mania of the 1630’s and the Weimar Republic stock market from 1914 – 1923.

Without a doubt in my mind, the move up in the precious metals sector since January 20th is the market story of the year so far.  What makes this even more remarkable is the relentlessness of the move despite the obvious repetitious attempts by the Federal Reserve/bullion banks to push the price of gold/silver lower with fraudulent Comex paper derivatives, as evidenced by the rapidly escalating amount of paper gold/silver contracts printed and sold into the “market.”  The open interest of paper in relation to the amount of underlying deliverable physical gold/silver on the Comex has been multiplying recently at a geometric rate.

This rise in the price of gold/silver has ensued despite a plethora of skepticism from even the traditionally bullish precious metals-investing analysts.  Most market prognosticators – and I’m more less guilty of this myself – have been forecasting a sharp pullback/correction in response to market technicals which heretofore have signaled the imminence of a massive bullion bank price attack.

Further contributing to the surprising price-behavior of gold is the absence of Indian imports which push the market higher with elephantine seasonal demand at this time of year.  India’s import machine has been effectively shut down from a jeweler’s strike since March 1.  This source of physical demand has begun to stir, which could make the present build-up in the paper short interest in gold and silver particularly interesting to watch.

There’s a flood of capital on the sidelines that stands ready to move into the sector but that is waiting for a big price pullback before initiating or adding to position.  The “smart” institutional money has been unloading historically overvalued stocks and is loathe to buy near-zero yielding Treasuries.   Perhaps this dynamic in and of itself will pre-empt any meaningful price corrections for the time-being.  While it may feel like the metals and mining stocks have made an unsustainably large move since mid-January, these two graphs below provide some perspective on the “scale” of the current move (click to enlarge):

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As you can see, the two graphs of gold and the HUI index, while making a large percentage move since mid-January, have barely moved the needle in relation to their mid-bull market tops in 2011.

For as brutal and relentless as the manipulated price correction has been for the last five years, we can expect the next move higher to be a least as equally forceful in its power and durability.  Make no mistake, the underlying fundamentals which triggered the de facto financial system collapse in 2008 and drove the precious metals sector its peak in 2011 have become even stronger since the advent of QE – the money printing which further fertilized and enabled these systemically catastrophic inducing trigger-points.

The junior mining stocks are set up to provide life-style changing wealth creation.  But finding the ones that are bona fide companies is a challenge.  The Mining Stock Journal presents bi-monthly commentary and insight to the precious metals market plus a well-researched junior mining stock idea with each issue.   You can access the current report plus the back-issues (distributed via email) here:  Mining Stock Journal.   The issue that will be published today presents a relatively undiscovered and incredibly undervalued company.

Silver Is Off To The Races Again

What we don’t know about the gold/silver price admissions is what it has stirred up behind the scenes … meaning how it might be, or will, affect the manipulation of the precious metals in the United States, where the real big issue resides. There is no telling what could be percolating at Gold Cartel headquarters … or what just might be TOLD to them.  –  Bill “Midas” Murphy from tonight’s Midas report (LeMetropolecafe.com)

There’s a lot of factors going on right now that could be pushing gold/silver higher over
Untitled1and above the inexorable headwind of Central/bullion bank market price manipulation.(click on graph to enlarge).

Today’s move up could be attributable commencement of the yuan/gold price fix rolled out by the Shanghai Gold Exchange.  But this was a known event well ahead of time and the market theoretically should have priced this in.  Same deal with the Deutsche Bank lawsuit settlement.  But that event hit the tape last Wednesday and gold/silver yawned.

Something a lot more profound seems to have developed behind the thick fog of Orwellian smoke billowing from the western Central Banks and Governments.  I believe the financial system is collapsing.   This explains the Fed’s frenetic attempt to keep the stock market propped up.  This effort has become about the only part of the Fed’s activities that is transparent.

Phillip Kennedy – Kennedy Financial – hosted me on his Youtube program to discuss some of the factors that are contributing to the surprisingly strong move higher in the precious metals sector.  Phil blends sharp insight with humor to produce an informative and entertaining show:

I recommended a silver stock in early January that has gone up over 600% since its January 10th close.  Shortly after that recommendation to subscribers of the Short Seller’s Journal, the Mining Stock Journal was introduced.  I’ve featured three other junior stocks which easily have the same upside potential as the silver stock.  “I got the email with the past reports. Thank you very much. This is an incredible value” – new subscriber comment.

Right now I’m offering all of the back-issues to subscribers (debut issue was March 4th). I’m already working on the next issue and the stock I’ll be featuring is not well known (for now anyway) and is irrationally undervalued. You can access these reports here: Mining Stock Journal.

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Gold Looks Ready To Spike Higher – JPM Gets It Wrong Again

These are the most gold-friendly readings in almost 2 months. India is getting ready to participate in the world gold market again. India’s gold imports drop 80.48% to $972.9 million in March documents what a heavy blow the Indian gold retailers strike struck to global gold. JBGJ guesstimates March imports at around 24 tonnes meaning some 120 tonnes of demand was lost in March.  – From John Brimelow’s Gold Jottings.

The quote above from Brimelow’s Gold Jottings report is in reference to the fact that gold import price premiums in excess of the import duty India’s gold market began to appear again.

Since the big move higher through early March, gold has been surprisingly “resilient” up to this point from repeated attempts to manipulate the price lower. The most common occurrence has been attempted “flash crashes” during early Asian trading. Interestingly, gold has tended to rally after the London a.m. fix and into the NY Comex floor trading hours. Perhaps most surprising is that the bullish activity has occurred in the absence of demand from India. India’s jewelers have been on strike since March 1, which has effectively closed down India’s massive gold import machine (excerpt from the latest issue of the Mining Stock Journal).

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The graph above (click to enlarge) shows the big “cup/handle” formation that has formed in gold since its extraordinary move since mid-December.   “Extraordinary” because the gold market has had to endure strong headwinds in the form of a literal avalanche of anti-gold propaganda from the financial media, financial cable networks, Wall Street banks and even some of gold’s supporter.

As you can see from that graph, gold has been “oscillating” sideways, digesting the 21% bottom to top move it made in a short period of time.  Perhaps most impressive about the move is its durability despite a continuous flood of paper gold thrown at the market by the Comex bullion banks, per the CFTC’s Commitment of Traders report.  In fact, the latest report released last Friday showed a big spike higher in the bullion bank net short position in both paper gold and paper silver.  Typically this signals an imminent, manipulate price-plunge, enabling the Comex operators to cover their shorts at a handsome profit.

Too be sure, the technical formation in the graph above could break either way.  From a technical standpoint, it would not be atypical to see the price of gold to pullback to the “rim” of the cup (112 area on GLD) or even down to the 200 dma (red line, 109.40).

But the market manipulators will not be getting help from India, who’s elephantine appetite for gold at this time of year appears to be picking back up or from the public, which has been converting paper fiat dollars into gold at a record rate per this report on gold eagles sales by SRSRocco.com.

JP Morgan’s mining stock analyst issued a report on Agnico Eagle (AEM) in which he made the assertion that, “the company’s exploration efforts have yielded good results, resulting in an increase in the share price, even against declining gold prices.”  Hmmm.  I wonder what kind of smokable material JPM’s analyst has been putting into his pipe (click to enlarge:

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Can someone please show me where on that graph that AEM’s price is rising “against falling gold prices?”  Just eye-balling it, I would say that AEM’s price movement is about 85-90% correlated with that of gold’s.
Too be sure, AEM is one of the few large cap mining stocks that I would ever consider owning.  And I will alert subscribers to the Mining Stock Journal when I see a trading opportunity in AEM stock.  However, currently I would recommend finding high quality juniors.  We had two stocks in the fund I co-manage that were up 24% and 20% today.  And my latest issue of the Mining Stock Journal features a stock that is below 30 cents and could easily double or triple once the general market discovers it.  Currently I’m distributing every back-issue of the MSJ to new subscribers, but that offer will end soon.

Is The Pullback In Gold Over, Part 2

The bullion banks/Central Banks seem to be having a problem pushing gold lower here. Nearly every evening (U.S. time zone) they take a sledge hammer to the price by dumping payloads of paper gold electronic contracts in the Globex trading system.  But gold snaps-back typically after the London a.m. fix.  They also try to hammer it about 25 minutes before the Comex floor trading opens, to no avail:

Untitled3This graph on the left shows the spike up in gold that occurred at 9:05 EST today (the x-axis is MST).  The banks tried to hit gold about 15 mins after the stock market open but failed.

The next graph shows the daily gold price since September 29, 2015.   As you can see, gold appears to be consolidating Untitled1after a pullback from the 20% move that occurred from early January to early March.

I find it amusing when the gold investment community starts whining about a price pullback after a big move in a short period of time.  When is the last time the S&P 500 moved up 20% in 2 months?   It looks like the momentum indicators are curling back up as well.  The action in the HUI and the metals reminds of late 2005 and late early November 2008.   I leave it to the reader to review that particular history to see if they draw a similar conclusion.

Note:  I just got off the phone with the CEO of a junior gold mining company that is one of the best ideas from a risk/return standpoint that I’ve seen in 15 years of researching, investing in and trading this sector.  There’s been a handful of time when I’ve smelled “grand slam” ideas – Aquiline Resources, Silvercrest Mines, Wheaton Minerals (which became SLW and Gold Wheaton), Osisko, to name some of the most memorable.  I smell a grand slam in the making with this company.  I’ll be featuring it this week in the latest issue of the Mining Stock Journal.