Loading ...Disclosure
After the FOMC minutes and the ending of QE, gold fell but support was not broken. Silver fell to support in GBP and maybe other currencies, even though in dollar terms it looked shaky. On that basis, I thought the worst damage was done, and I used 15% of my trading cash to nibble at yesterday’s prices.
But we were watching the wrong horse; because since FOMC, the Japanese announced further QE, the dollar:Yen had a major move to near 112, and yes, it’s a mystery, but this is what knocked PM’s off their perches.
Now gold support is broken, and this could be a very dangerous development. Silver support in GBP (as I read it) is broken, and I see a potential 25% decline therein. The mining shares are hitting new lows, and could be signaling that PMs are ‘over-valued.’ The spectre of a deflationary crash looms, and all sorts of warning indicators are on red.
On this basis, I sold back that nibble at an immediate loss, because I think the worst is to come.
So there is my disclosure; I’m not just sitting on cash, I even sold a bit of swing portion at these prices. Now I wait. If prices zoom up from here, I’m still heavily invested and will be happy in that scenario too.