Monday, November 15, 2010

Top-Callers Out In Force

After being bombarded all weekend with articles and notices from so-called experts and market-timers regarding the death knell of the 10-year old, secular bull market in gold, I thought I might attempt to provide some fortitude for you, my dear reader.


Three years ago this week, gold closed at $890/ounce. After trading to almost $1100 by March of 2008, gold was back down to $770 by November 2008. At this time last year, gold was trading around $1125.
Look at this chart:

Lots and lots of price corrections but never an end to the bull market. The action of last week is not the end, either. Have the fundos changed? Is the US suddenly solvent? Are states like CA, NY and IL suddenly solvent? Are all the various state and local pension funds suddenly solvent? Are buyers lined up out the door to participate in all future Treasury auctions and refundings, thereby eliminating the need for QE2 and QE3 and QE4?

Why is it that gold is the only bull market where every 2-4% correction brings out the top-callers? How many times did AAPL correct 2-4% in its run from $10 to $300? How many times did the Dow correct 2-4% in its run from 800 to 14,000?

Be at peace. Do not sell your gold, your silver or your mining shares. Do not trade front-month futures or options. This latest correction in price will only serve to contain gold and silver in a range, probably through Thanksgiving. As mentioned on Friday, let's look for maybe 1345 on the downside and 1390 on the upside until the next big move commences.


  1. A good buddy and I were talking this weekend about the manipulation happening. He had the analogy of holding an inflatable ball underneath the water in a pool. The more harder they try to hold it down, the greater the explosion when it eventually shoots up. Thanks again for all your insight. People need to stay the course and keep piling into every dip.

  2. Let's see if we can get up above 1385 and hold. So far very impressed with the metals resiliency.

  3. Turd,

    Have you heard of this guy before..

    Looks like one more top caller.

  4. Silver @ 25.73 as I type...would be nice to see some firm buying here.

  5. Turd - love the blog! Can you recommend any mining stocks?

  6. So far you called it, Monday is a downer day. And I thought you were full of beans when I read that...good call. Hope it turns tomorrow as you predict.

  7. Chak: A top-caller at Kitco?!? NO!!!! What a joke they are...

    dd: Silver could trade down to 25. A steal if it gets there.

    Dan: Some of my faves are EXK, SVM and SLW in silver. EGO, NG and TRE in gold.

  8. As a silver holder, I don't think the precious metals bull has ended.

    What concerns me at the moment is that the dollar might have bounced off an intermediate cycle low last week.

    If the dollar continues rallying it's going to cause painful drawdowns in silver and gold.

  9. Thank you for the stock recommendations, Turd! Much appreciated.