The Things To Come

Further upside that is. Prepare yourself for either 990 or 1010 before we consolidate to the downside. There is no major bear left who will dare to short this tape at this point – this was a historic shake down you’ll tell your ill-bred grand kids about one day.

The chart says it all – never mind the wave count at this point which is actually quite clear but we really don’t care at this point until we see a retracement in the works. Futures are trading sideways overnight and you should know by now what that means 😉

Okay, first up – forget about Gold, okay? It’s a mess – it’s being manipulated – plus the wave count is clearer on Silver. Also, I expect the Gold:Silver ratio to start widening again, which means you want to be in Silver anyway.

Don’t try to be a hero – wait for 14.5 minimum – thing has a tendency to fool the bears and eats theta for breakfast/lunch/dinner. Actually, forget about the Silver price chart – here’s what you really should be watching:

For you mentally challenged rats: This is the Gold:Silver ratio which is a measure of the amount of risk investors are willing to take on. Whenever investors are worried about the economy a money starts moving into Gold and out of Silver – or actually in most cases they pull less money out of Gold than they pull out of Silver. So, a dropping Gold:Silver ratio means that investors are increasingly willing to take on more risk right now. Which by the way completely defeats the argument of the Gold bugs that investors are moving assets from equities into Gold – but that’s a discussion for a different day.

What you should watch out for is for this ratio to start flattening out and perhaps even swing to the upside. That will be a pretty reliable signal that Silver is ready to start dropping to the downside. I’m actually looking forward to playing some futures contracts this time around. I know there’s some slippage but I’m expecting a long wave and I’m sick of those SLV puts – LOL 🙂

The Dollar should keep dropping and will probably accelerate once we drop through 78.34 – the prior low. Don’t have time for a chart on this one as it’s late and I just came out of a meeting – need to prepare for tomorrow’s ass whopping and then turn in to get my beauty sleep.

Cheers,

Mole