Finansiella Insikter

James Turk har både gjort en ny intervju med King World News samt skrivit ihop ett exklusivt inlägg för KWNs läsare som är intressanta att ta del av.

Turk om guld:

I’m taking my cue here from the mining stocks. The XAU once again held above the 200 level which has been the bottom of its trading range. That suggests to me that both the mining shares and gold are sold out here and due for a big bounce.”

The action in gold this week will be important as strength here will indicate the beginning of a move back toward its record high. I expect that high to be probed by the end of this month. After all Eric, nothing has fundamentally changed. The dead cat bounce in the dollar has not altered the bullish outlook for gold.

Turk om silver:

At times like this it is important to stand back and take a look at the big picture. So the key point here Eric is to focus on the chart (above) which does a great job of illustrating this. If we put last week’s price drop into context and focus on all of the factors that have been driving silver higher for ten years, it’s logical to conclude that the big price jump in silver is still ahead of us.

Eventually there will be a mania in silver, but in the fullness of time what we just witnessed will be seen as a first act. The fact is that the final parabola in silver during the climax of the third stage or manic phase will be one for the history books.

Och här är inlägget från James Turk:

Silver’s Correction – We’ve Been Here Before

By James Turk, Founder of GoldMoney.com

May 9 (King World News) At times like this it is important to stand back and take a look at the big picture.  So the key point here is to focus on the chart above which does a great job of illustrating this point.  If we put last week’s price drop into context and focus on all of the factors that have been driving silver higher for ten years, it’s logical to conclude that the big price jump in silver is still ahead of us.

Silver’s price drop last week has been variously called historic, extraordinary and unprecedented.  It was none of those, as is clear from the following chart.  We’ve been here before.

Note the four red ovals.  All four outline similar drops in price over short periods of time.

This chart is prepared on a log scale so that the distances shown on the chart can easily be compared in percentage terms.  In other words, last week’s drop in the silver price from near $50 is essentially no different in percentage terms from the drop that occurred once $15 was approached in 2006 or the drop after $8 was reached in 2004.  In both of these prior instances, silver bottomed after the drop, marking a level from which it climbed to eventually make a new high.

The drop in silver’s price in 2008 was different.  Silver continued lower, breaking down from the red oval, but we all know why that happened.  Lehman Brothers had collapsed, and in the subsequent rush for liquidity, every asset class was hit – even gold and silver.  It was a classic example of the ‘baby being thrown out with the bath water’.

So what is ahead for this current correction?  Repeats of 2004 and 2006, or another 2008?  My guess is none of the above.  It took several months after these three previous corrections before silver climbed above the high price that preceded the correction.  This time I expect silver will take only several weeks before exceeding $49.78, the 31-year high reached on April 25th. The reason?

As evidenced by silver’s backwardation, which began in January and continues to this day, the demand for physical silver has really accelerated.  As a result of last week’s price decline, backwardation has roughly doubled in size.  This is clearly a a signal of strong demand for physical silver, and further evidence of a point I have been making for some time, that the paper silver market is losing its significance as a price discovery mechanism.

Rekommenderar att lyssna till vad James Turk har att säga om den allt svagare dollarn i följande KWN-intervju:

Here we are right at the lows and in fact we are actually now probing the November 2009 lows on the dollar index. The interesting thing is that the low in 2009 on the dollar index that is when the Greek crisis started to unravel and people went into the dollar as a safe haven.

And here we are right at those lows again, the Greek crisis is reemerging because apparently they are going to have to restructure those debts and there are going to be some losses taken, and no one is going to the dollar as a safe haven. To me that suggests that we are very close to this waterfall decline in the dollar that we have been talking about.”

When asked what will precipitate the waterfall decline in the dollar Turk replied, “Ultimately it’s going to be the loss of confidence in paper currency and the promises from Bernanke that he’s going to fight inflation when it occurs, and everybody knows that there’s a lot of inflation that they are not fighting.

The politicians unwillingness to cut spending or have any kind of discipline forced on them, the S&P credit rating, putting the US government’s AAA rating on negative credit watch, cumulatively all of these things like one stone at a time or one straw on the camel’s back, eventually the camel’s back is going to break.

That’s why when I talk about a waterfall decline, I think we are really at that stage where this is going to go all at one time. The Scottish historian Niall Ferguson has a very good description he says, ‘We live on the edge of chaos’, and what he means is that if you keep putting bits of sand on top of a pile, one grain of sand at a time it looks really pretty until you have one grain of sand too much and the pile collapses.

It’s the same thing here with the dollar, the news is just continually bad. There is nothing being done to put the dollar on the right course and we are going to have one little news item whether it’s Greece, Portugal, budget deficits in the US, who knows what? Chinese unwilling to buy US debt securities, can’t really forecast what that one little news item is going to be but that will break the confidence and then you are going to see that waterfall decline.

Dollarn har nu på morgonen fallit igenom det viktiga stödet på dollarindex (DXY) vid 74 som utgjorde botten innan Greklandskrisen 2009. Skulle inte bli förvånad om vi får se någon slags ’tillverkad händelse’ för att skapa ett tillfälligt dollarrally och undvika en kollaps. Om vi inte får se ny negativ information från Europa (t ex i form av ett förnyat rykte om grekisk omstrukturering till helgen) så kan Ben och Tim alltid plocka fram någon korrupt Fed-ledamot som kan spy lite propaganda och snacka upp dollarn genom ‘verbal intervention’.

James om silver:

I don’t see the shorts panicking yet. I think we are getting to the stage though where people are afraid to add new shorts into the markets simply because of what’s been happening with the price. So I’m still looking for my $50 target and when we were speaking on Monday I said it could happen in a couple of weeks but we’ve gone up a couple of bucks in just the last couple of days.

So yeah, you are going to get that short covering and you are going to get the panic and it’s going to take things higher.

King World News har intervjuat James Turk, som i Barron’s 2003 prognostiserat att guld kommer stiga till 8000 dollar (baserat på ett 1/1 ratio mot Dow Jones), men som nu känner att detta är en på tok för konservativ siffra med tanke på den hastighet som världens centralbanker trycker upp pengar för att hålla den statsfinansiella bubblan vid liv.

Jag har ingen som helst tvekan om att James kommer att få rätt för när ‘nollställningen’ väl kommer finns det i princip ingen övre gräns eftersom det heller inte finns någon nedre gräns för hur mycket dollarn kan tappa i värde.

Här är intervjun med Turk:

Eric I have really been focusing a lot on what central banks are doing and how their actions might be impacting my long-standing forecast for the price of gold. You probably know back in 2003 I stated in a Barron’s interview that the Dow/Gold ratio would be 1 to 1 again sometime between 2013 and 2015. My thinking had been that gold would be $8,000 and the Dow would be 8,000, but now my thinking has changed.

I think that my gold forecast was too conservative. Given the way central banks are printing money when they are buying government debt, I think the 1 to 1 ratio is going to be reached at a much higher price.

People don’t understand how much wealth destruction has yet to occur as this financial bust that we are in works to its inevitable conclusion. In effect, the Dow has to lose 90% vs gold. This wealth destruction is going to devastate a great many investors, in fact most of them will never recover from this event.

As I said earlier Eric, my thinking has changed as we have been going through this cycle. This time around is not going to be like the gold bull market of the 1970’s. The dollar is going to lose its status as the world’s reserve currency. This is fundamentally different than what occurred in the 1970’s.

The US government has been running some of the largest deficits in history. That means a lot of dollars are going to be created by the Federal Reserve to fund this newly created debt. Recently we have been focusing on the US dollar and I want to be clear that I expect the dollar to drop to levels never seen before in history, and the scary part Eric is that it could do it very, very quickly.

When we take out the all-time low of 71.33 on the dollar index, we move into uncharted waters and there is no telling where the collapse of the dollar will end. Some states are already taking steps to protect their citizens from the collapse of the dollar. The Utah House just passed a bill calling for the return of the use of gold as a currency and there are at least half a dozen other states considering similar legislation.

I’m often asked by people when do I think they should sell their gold? I tell them this time around it’s going to be easy because you are not going to sell your gold, you’re going to spend it. In other words, gold will once again become currency.

King World News har intervjuat James Turk som observerar att dollarn har format en gigantisk topp de senaste 2,5 åren och nu ser ut att stå inför en kollaps som kommer att chocka världen. James kommenterar även guld och silver och upprepar sin prognos om ett guldpris på 1800 dollar i år.

Det här är vad James hade att säga om dollarn:

I am looking at the weekly chart for the last 2 1/2 years and my conclusion is that the dollar is forming a massive top.  If we stop to consider that gold was rising while the dollar was basically going sideways during this period of time, imagine how rapidly gold will rise when the dollar starts falling.

What I’m watching here very carefully is how the dollar is reacting to events in the Middle-East and higher commodity prices.  Brent crude is presently $115 and that is signaling higher inflation.  It’s a signal that everybody around the world is watching.  So watch the dollar index closely.  It broke below 77 and the chart is starting to look heavy.  

Eric you have been saying all along that the dollar isn’t bouncing and it now appears the dollar is ready to fall off of the edge of a cliff.  The dollar collapse is going to be the next big story.  If I am right and the dollar really starts to dive, the implications are global in nature and I truly believe this event will shock the world.

Om guld:

To me the most important thing is this huge base that we now have in gold under $1,400.  I see it as a major launching pad that could easily take gold to my $1,800 target for this year.  

Om silver:

I think the major message in silver is that every dip is well bid for.  The shorts and other big players may gun for stops from time to time, but they can’t change the underlying trend, or the very bullish fundamental picture.

When the gold and silver markets start becoming disorderly, then we will know the metals are going to take a breather.  But everything at the moment says we should be focusing on higher prices for both gold and silver.    

Kommentar från Eric King:

71 to 74 is seen as the last support if the dollar heads lower.  If that support fails and the dollar breaks 71, then a waterfall decline with panic selling could come into play.  Turk is right, that event would shock the world.

I en intervju med King World News noterar James Turk att dollarn hänger vid ett stup just nu och att om vi bryter ner genom 77 på dollarindex så kan det gå riktigt fort utför och givetvis det motsatta för guld och silver.

Turk påpekar att dollarn alltid varit en tillflyktsort under perioder av osäkerhet, så med tanke på att den knappt lyckats lyfta efter den allvarliga situationen i Nordafrika och Mellanöstern är det så långt ifrån ett styrketecken man kan komma. En dollarkollaps kan vara nära förestående.

Här är intervjun med James Turk:

The dollar right now is hanging on the precipice.  If we break below 77 on the dollar index, look out below.  I don’t think people really appreciate how scary the dollar chart is here, or how ominous the implications really are.  There’s no predicting how far the dollar could plunge if confidence breaks.”

You’ve got civil war breaking out in North Africa and you have rebellions happening in the Middle-East.  In this kind of geopolitical situation, in the past the US dollar would always rally, but this time it can’t even bounce.  You know Eric the other side of this coin is that if the dollar falls off the edge of a cliff, precious metals are going to skyrocket.

Om silver: During the most illiquid time of the trading day, somebody decided to take out all of the stops in silver.  If you were not following during business hours in the Pacific Ocean you missed it.  I woke up this morning and looked at the chart and couldn’t believe what happened while I was sleeping.

The important point Eric is that no technical damage was done and in fact the situation has become even more bullish because that little smack down overnight took out all of the weak hands.

With this month’s important options expiry now behind us, I’m looking for higher prices next week.  Even though the March/May spread has flattened a little, the backwardation continues to grow to 2015 and has ballooned further to $1.16.  The short squeeze is continuing to develop.  The shorts are trapped and whether the trap springs this week or in a month or two I don’t know, but we are getting very close.

Om guld: While silver did get hit in overnight trading, gold hardly moved and then snapped right back.  Remember I said last time that the gold chart is beginning to look really strong, that is what the event last night displayed.

Gold is incredibly resilient and looks coiled for an explosive move higher.  We started our initial probe of the all-time high this week closing in on $1,430 before backing off.  Look for another probe of that $1,430 level very soon.  It won’t be long Eric before we take out that all-time high, particularly if the dollar falls off the edge of a cliff.

Här är en graf över dollarindex med kommentarer från Dan Norcini från i onsdags:

I mentioned yesterday in my comments that the Dollar was very weak even in the midst of what was most certainly a day in which risk trades were being pulled off and a rush to safety was underway.

Normally during such events, the Dollar along with the Japanese Yen, tend to be the beneficiaries of such activity. All that the Dollar could do was to end up a few points after spiking initially almost 100 points higher. That sort of activity was very telling and indicates that the safe haven bid for the Dollar was practically non-existent.

Today, with crude oil soaring, the broad equity markets, particulary the Nasdaq, getting slammed, and increasing unrest in the middle East as fear grows about the stability of Saudi Arabia, the Dollar is actually getting sold off. That is most remarkable.

I am thinking that the market is looking at the fragile state of the US economy and voting that rising oil prices are going to hit the US harder than most others. Keep in mind, that this is an “economic recovery” built almost completely around the Fed’s massive liquidity injections through its QE program. That liquidty is being eaten up by rising crude oil prices as if by a munching PacMan.

It is as if the Fed is pouring water into a container full of holes punched in it by a awl with the words “crude oil” engraved on the handle.

As I am writing this, I am also noticing that the long bond is fading quite dramatically from its best level of the session. That too will bear watching.

James Turk, som de senaste dagarna har gått från hjälte-status till kult-status bland silverinvesterare världen över för sina träffsäkra prognoser i takt med att silverpriset exploderar upp, har intervjuats av King World News där han imponeras över silvers backwardation på 73 cent som saknar motstycke.

Det James talar om är otroligt viktigt för den validerar den information vi tidigare fått om att silverhandlare sålt slut på silver. Det är en signal som vittnar om hur otroligt stor efterfrågan är på fysiskt silver just nu. Eller som en bloggare uttrycker det:

I’ll make this easy to understand: if you don’t get your hands on physical soon, you may not have a chance to, and if you by chance come across some a year from now, you most likely wont be able to afford it.

Här är intervjun med James Turk:

The backwardation that we have been talking about has now blown out to 73 cents, that is unprecedented.  I find that number to be completely astounding!  Where are the arbitrageurs?  They could make a fortune.  This suggests to me that the arbitrageurs are out of the market because they don’t have the physical metal to sell to deal with the imbalance.”

The fact that arbitrageurs are not pouncing on this huge bakcwardation is just further evidence of how little physical silver is available.

Going back the KWN blog we did on February 10th, this backwardation in silver has potentially huge implications for the US dollar.  Metal goes into backwardation for two reasons – Either short supply, or nobody wants to accept fiat currency.  We know the backwardation in silver is because the supply of physical metal is so short.

But the lingering question in my mind is whether the strong hands who hold silver are unwilling to take a fiat currency.  If that is the case, and this backwardation in silver eventually leads to a backwardation in gold, the implications for the US dollar, and indeed all of the fiat currencies in the world are ominous.

James Turk om guld:

Eric, here we have gold in London trading above $1,400 this morning.  For the first time in a couple of weeks, the gold chart is starting to show real strength.  I expect gold to be probing the old high of around $1,430 by the end of this week, given the strength we are already seeing.  The old high should not provide much resistance, so expect new record high prices in gold soon.

Silver började torsdagen lite trevande kring 30,70 dollar men fullkomligen exploderade efter att priset tog sig igenom motståndet kring 31 dollar i den amerikanska handeln. Silver bara steg och steg och handlades som högst i 31,81 dollar i efterhandeln, upp 3,5%. Snacka om en ‘short squeeze’!

För de av er som vill ha lite mer bakgrundsinformation kring denna short squeeze rekommenderar jag att läsa följande artiklar från King World News:

London Source – Asians Buying SLV to Take Delivery of Silver

Turk – Massive Short Squeeze in Silver, Gold to Hit New Highs

Samtidigt som JP Morgan & co tvingas kapitulera på silvermarknaden när de inte längre kan stå emot den massiva anstormningen efter fysiskt silver, så passar de på att hålla nere priset på guldmarknaden, där man fortfarande har lite fysisk metall som man kan dumpa. Detsamma gäller aktiemarknaden, där man inte har några problem (vare sig resurs- eller samvetsmässigt) att ‘blanka skiten’ ur både silver- och guldgruvor. Troligtvis innebär detta att JP Morgan återigen har beställt en marginalhöjning för silver av CME, vilket kommer att få aktierna att falla, om än tillfälligt. Utnyttja en sådan händelse som ett fantastisk köptillfälle!

Här är en passande kommentar från Midas:

Silver has set a new 30-year high today but the silver juniors are barely participating in the rally. There is absolutely no chance that the Cartel will not launch every weapon they have in a counterattack on the metal, and that includes shorting the hell out of the juniors, before the COMEX expiration window closes. I have my fingers crossed that silver will hold its gains and completely break out here to new highs, but I think we have a real battle ahead and it will not surprise me in the least if silver is pushed back below $30 over the next few sessions. None of this will matter much over the longer term.

Tappa inte tålamodet med era silver- och guldgruvor. Det gäller ju att vara lite extra uthållig när motparten är den amerikanska staten. Men det finns en gräns hur länge det går att blanka dessa aktier oavsett vilka resurser man har och när den passeras kommer det explodera kan jag lova.

James Turk har skrivit ännu en intressant artikel som jag kan varmt rekommendera där han ser att vi närmar oss fas två av denna ‘bull market’ för silver som påbörjades 1991. Fas två påbörjas, enligt Turk, när silver passerar 50 dollar.

Silver is Approaching Stage Two of its Bull Market

February 14, 2011 – Back in April 2007, I wrote about the three stages that appear in every bull market, and more to the point, that gold was approaching the end of stage one.  Gold back then was still trading around $690, and therefore well below its then record high of $850 reached in January 1980.  My view was that “gold looks ready to make a new all-time high. When that happens, stage two begins. There will not yet be widespread excitement about gold in the next stage, because that won’t occur until stage three. But when gold makes a new record high, and particularly after it breaks into a 4-digit price, people will begin paying attention.”

I wrote a follow-up article in November 2009 entitled Welcome to Stage Two of Gold’s Bull Market, just two months after gold broke above $1,000.  Focusing on the change in prevailing sentiment, I noted how differently gold was being treated.  “During the first stage of a bull market, the media and most investors alike focus on past issues, rather than future potential.  Over the past decade one consequently heard all the reasons not to own the gold…But there is a notable difference in this stage compared to stage one.  Look how many people are writing and talking about gold.  Gold has moved from apathy and neglect – stage one characteristics – to growing attention.  But importantly, instead of embracing gold and analyzing it to determine relative value, today’s attention is one of widespread disbelief and skepticism that gold can climb higher.  These are exactly the responses one should expect to emanate from stage two.“  I concluded by noting that at some unpredictable point in the future, gold will enter stage three “when gold no longer is relatively good value.”

I did not make any mention of silver in the above two articles.  It too has three stages, but silver is still mired in stage one, which began in February 1991 after silver had collapsed to $3.50.  It was an astounding 93% decline from its January 1980 peak of $50.  But as we can see on the following chart, $3.50 was silver’s low, and its price has been rising ever since.

This chart shows a massive accumulation pattern, marked by the green lines.  This pattern is a story of strong hands and weak hands, specifically, of silver moving to the former from the latter.

From its $50 high in January 1980 to its $3.50 low in February 1991, the weak hands were shaken out.  At that point, the accumulation by strong hands – who were buying because the recognized that silver was an exceptional bargain – became the dominant force.  Their buying power was stronger than the selling pressure of the weak hands, and the price of silver responded by starting to climb.  It was classic stage one action, but here’s the important point.

Silver is still in stage one.  It won’t advance into stage two until $50 is exceeded, just like gold did not enter stage two until its previous high of $850 was hurdled.

I expect that silver will exceed $50 this year, which is a point of view I first mentioned in myoutlook for 2010.

Admittedly, I was a little early with my forecast about when gold would enter stage two.  So perhaps I will again be early by forecasting that silver will enter stage two of its bull market this year.  Regardless of the accuracy of my timing, one thing is clear.  Because it is still in stage one, silver remains good value.

James Turk gör oss i ett färskt inlägg uppmärksamma på att guld/silver ratiot just nu befinner sig på en viktig teknisk nivå kring 45 (se diagrammet nedan) och ger oss rådet att hålla ett öga på detta ratio.

Skulle ratiot bryta ner igenom denna nivå med besked kan det enligt James innebära att det går snabbt ner till mellan 30-35. Eftersom en sådan händelse också är positiv för guld, skulle det sannolikt innebära att silver kan ta sig upp till minst 40 dollar. Men det finns givetvis ingen garanti att nästa uppgångsvåg blir så kraftig.

Watch the Gold/Silver Ratio

February 12, 2011 – In precious metal bull markets, silver outperforms.  Its price climbs at a faster rate than gold’s price.  The reverse happens in bear markets.  Silver’s price drops at a faster rate than gold’s price.  The following chart of the gold/silver ratio illustrates this phenomenon.

At the peak of the last precious metal bull market in January 1980, it took 17.4 ounces of silver to buy one ounce of gold.  Thereafter, the ratio turned and started climbing higher.  By February 1991, 101.8 ounces of silver were needed to exchange for one ounce of gold.  Silver was trading at only $3.50 per ounce, down 93% from its previous bull market peak.

Silver back then was “dirt cheap”, but it would not get any cheaper.  Silver turned the corner as value oriented buyers recognized a bargain.  Since then the price of silver has been generally rising, and has been doing so faster than the spectacular rise in the price of gold.  The result is a long-term downtrend in gold/silver ratio.  In other words, since 1991, silver has outperformed gold.

Last week, the ratio touched 45.0 and ended Friday at 45.3.  It was the lowest daily and weekly close for the ratio since February 1998, which is a significant date.  That is the month Warren Buffett announced that he had acquired 130 million ounces of silver.  His footprint is visible on the above chart.

We know from his disclosures that he began buying silver around $4 in July 1997.  The ratio then was in the mid-70s.  But note what happened to the ratio as Buffett accumulated his hoard over the next several months, culminating with the announcement of his purchase.  The gold/silver ratio fell by nearly 50%, so that only 41.3 ounces of silver were needed to buy one ounce of gold.  Silver was clearly outperforming gold, just like it has been doing over the last several months – as shown in the above chart by the remarkable drop in the ratio.

The ratio has now reached an important point.  It is breaking through support, which is illustrated by the lower red line on the above chart.

Several previous attempts to break through support have failed, with the result that for many years the ratio has continued marking time within a trading range bounded by the parallel red lines.  That trading range now looks mature and ‘ripe for picking’.

One never knows of course how the markets will unfold in the future.  But I expect that the ratio will finally break through support, which is an event that I have been looking and waiting for patiently over many years.

If I am right and the ratio knifes through the low 40s and below the Buffett point, there is no clear short-term target.  Given the momentum evident in the above chart and the bullish fundamental factors impacting silver at present – like its unprecedented backwardation – a drop to at least the low 30s seems highly likely, but I don’t rule out the possibility of the ratio falling even lower.

My long-term target for the ratio is 17.  It is approximately the average level at which the two precious metals were exchanged for hundreds of years prior to the arrival of fiat currencies in 1971.  It has been my view that a 17-to-1 ratio is attainable by 2013-2015, but given what seems to be shaping up, we probably won’t need to wait that long.

The unprecedented backwardation in silver has one clear signal.  The potential for a massive short squeeze is building.  If one occurs – as I believe is becoming increasingly likely – there is no telling how quickly a 17-to-1 ratio could be achieved.

King World News har intervjuat James Turk som tycker sig se att guld och silver har nått en viktig bottennivå och pekar bl a på den ovanliga situationen på oljemarknaden där Brent handlas över WTI, den negativa inställningen till guld och COT rapporten (som visar på rekordlåga långa positioner bland sk ‘managed money’) som viktiga orsaker.

Nedan är intervjun med Turk i sin helhet:

James Turk – Gold & Silver Have Reached an Important Bottom

With volatility continuing in gold and silver, today King World News interviewed James Turk out of Spain.  When asked about the action in precious metals Turk responded, “Through Friday’s close on the LBMA, silver remained in backwardation, even by the numbers reported on the LBMA’s site.  The strong bounce on Friday after the option expiration combined with the backwardation is clear evidence that silver doesn’t want to stay down here in this area and is ready to move higher.”

“If we get silver above $28.70, that will reverse the trend followers from short to long.  The number on gold is $1,378.  This is what is going to take gold and silver to new highs.  You will see open interest expanding as people who were shaken out come in and put on long positions.

You have to keep in mind Eric that this little shakeout over the last couple of weeks has done nothing to change the very bullish fundamental factors that have been driving gold and silver higher.  Most significantly the CRB CCI (Continuous Commodity Index) is at record highs.  There is simply too much money being printed around the world and this monetary debasement is behind the ongoing bull market in gold and silver.

There is a relationship between Brent Crude and West Texas Intermediate with WTI normally trading at a premium to Brent Crude.  However, over the last couple of weeks, Brent has climbed to a huge and record premium over WTI and has remained in the high 90’s.  At one point Brent was trading as much as $12 higher than WTI which is unheard of.

The significance of the way these two oils are trading is that Brent is a more accurate reflection of global oil prices and is therefore mirroring the record high prices we are seeing in the global food indexes.

Given the usual close correlation between the CCI and global crude oil prices and gold and silver, we can reasonably conclude that the correction in gold and silver is over and that the precious metals are going to start climbing higher.

As further evidence that we have reached an important low, bullish sentiment and the commitment of traders report are at levels seen at important bottoms.”

For those of you who are making monthly purchases of physical gold and silver, continue to do so and do not try to time these markets.  Evidence is mounting that both gold and silver are putting in a floor to the downside near these levels.  It will be interesting to see how high the next rally takes them.