HUI Chart – August 16, 2012

Gold And Silver – Greater Certainty Is Found In Charts

We can assert the trend is down because of lower lows and lower highs. What can be seen, at this point, is a very small range, so far, following a small range in May that closed poorly. What we know for certain is that the downtrend has not yet changed, so lower prices can be expected. We may hold an opinion that gold will ultimately be considerably higher in value, but there is no confirmation that price has begun to rally.

JPMorgan Now Long Gold. A Game Changer?

JP Morgan was able to maneuver itself to the long side of the gold market while speculators (which by nature are long during the bull market) have been pushed to the short side. Does it mean that the gold price will move up right away? No, although it could. Timing a price move is not what COT is about. But with the largest holder of gold futures contract on the long side of the market things could seem less bearish as the picture that has been painted lately.

Time Cycle Model for Silver Price

This simple model, which uses only four cycles and an exponential increase, indicates that a low in the silver price was expected approximately February – July 2013, and that the next high is expected approximately March – October 2014 in the $50 – $60 range. Further, the model suggests that a silver price of $90 – $110 is possible in the September 2015 – March 2016 time period. Do not depend solely on a model such as this; it is one of many tools.