Being successful in trading has a lot to do with finding the developing “story” behind the price structure of a market. We had good results in February because we keyed into some very important pieces of market information that would lead to a likely result for the direction of price, or what we call “the story of the market.” We had less success in March because the focus was more on trying to catch up to the story, where being just a step or so behind is not as rewarding, even resulting in loss.
For the past several weeks, we have shifted focus on what we see as the truer “story” of the PMs market, [Precious Metals]. Some may think we have gone off on an unrelated tangent talking about the elites and fiat currency. The PM community has maintained a relentless focus on how much gold is being imported by China, the diminishing supply of physical gold at COMEX and LBMA, and a host of other popular statistics that support what seems to be important for gold and silver adherents in their beliefs that should ultimately lead to higher prices.
What does this have to do with the price of gold and silver? Everything! Another huge clue over this is the fact that several indicators of unprecedented demand for both gold and silver have had zero impact on the market.
For the past few years, the only focus by the gold and silver crowd has been how many tonnes of gold China has been importing, marveling at the record amount moving from West to East, trying to calibrate as closely as possible how many tonnes it is. It should be enough to know that it is a record amount and that it continues to this day. Instead of expending so much time, energy, and effort determining numbers, just accept it as a given. It has been priced into the market. The more pertinent question is why has this widely known and accepted factual circumstance not had any impact on the price of gold?
Does everyone really need to know how many gold and silver coins are being bought by the public from issuing mints around the world? Is it really important to know how much gold is being smuggled into India? Is there anyone who keeps tabs on PMs that is unaware that Switzerland has been running shifts around the clock recasting gold to meet Chinese preferences for smaller bars that are .9999 fine? More information already priced into the market.
Yet, all this has been the heart of reporting by the PM crowd, plus coverage by the most respected minds in gold and silver, all end up concluding that gold should be $10,000 the ounce, silver $150 – $250 the ounce, or even higher for both. What are the current prices for gold and silver? Gold is about 13% and silver about 10% of projected prices.
What is wrong with this picture? Almost everyone is looking at the same information and maintaining the same expectations, and all are missing the less obvious but more relevant reasons why gold and silver struggle. Their “story,” while valid, is wrong.
It is the power of the elites!
“Give me control of a nation’s money, and I care not who makes the rules.”
Again, the subtext is, “Play by our rules or you will be destroyed.”
Source Gold Eagle