Sunday PM pre-game, 5/25/2014
Since gold could not clear and hold $1300, the death cross is on schedule for Friday barring a late-inning rally. You heard it here first. Friday is also the end of the month.
More bearish news -- gold finally closed below the 100-day MA. Those of you who chronicle the price of gold as closely as I do (both of you) are surely aware of its significance. Two times the Gold Bulls tried to break its stiff resistance--on Jan 27 of this year, and again on Feb 5--only to be beaten back by withering fire, by swords and pikes and pistols and muskets. Let me recount it for those who don't remember.
A blur of movement. The racket stepped up feverishly. Brigade Commander Sprott peered over his parapet in readiness to join his reeling men--though cautiously, very cautiously, ever wise and never impatient of restraint. In between thoughtful sips from his silver flask he gathers himself. There will be times when exposure is essential, he reflects, but should his deep-rooted pugnacity get the better of his lucid judgment, what of his contingent then! Boldness might make fortunes, but caution - ah! divine caution must keep it!
Cut now to February 10 ..., with the Cartel's guns dangerously aligned along their trenches. Heartless and fearless, that juggernaut of mechanized warfare has their dive bombers, their high explosives and their seemingly endless replenishment of reinforcements at the ready. A spirit of grimness penetrates the air. Abruptly, uncowed by stark position and high stakes, the Chinese People's Army dares to go where Rick Rule has feared to tread, blasting through the 100-day barricade!
But now the mist dissipates, now amidst the sweet savor of victory, Brigade Commander Sprott surveys the landscape from a high (very high) emplacement. The attrition has become evident. Long specs lie motionless by the thousands, their grotesque twisted corpses sprawled out in blood-soaked grass, riddled with shrapnel, gashed in scores, bored with bullet holes. They had been frightened out of their position by repeated raids at fifteen minute intervals carried out with the clock-like precision for which the Cartel was known. The sweet spoils of victory were not theirs to share. Sprott murmured between his teeth to Private Embry, whose eye had fixed upon a fallen man of broad muscled back, his white well-fed body made marble statue by Death. Embry turned him over in his mind and weighed him with his eyes. Sprott's gaze settled on the water-logged corpse of an elderly man stuck in a running brook, caught in the tangle of branches from a fallen tree. The deceased senior's steady sway lulled Sprott into a sedated state of sober reflection ... back and forth, pendulum-like, the slow stream stripping soft skin piece by piece from his face ... when -- terror! -- the lips detach, revealing white teeth in an indignant sneer. That evening, throughout the wonderful meal of venison medallions (cooked to perfection on an antique charcoal brazier), throughout the jaunty dancing with Embry and King and Rule and wife, throughout the bottles of post-prandial oak-aged Royal Maria lustily consumed, brought up from the cellar for the occasion, the dead old man's scornful visage darkened Brigade Commander Sprott's thoughts.
Still not short though until the GLD:GDXJ 3-line break reverses, confirming the DOW:GDXJ, which Friday added another bar..
And here we go ... the yields in silver chart working its way up to the green dotted wedge, which has historically marked a bottom in gold.
Till next time, friends!
Posted by GM Jenkins on Saturday, May 24, 2014