incense
- [noun] an aromatic substance acquired from certain resinous
trees with
aromatic
biotic materials which release fragrant smoke when burned. The
odor
produced
from smoke is not the incense, but the substance that is burned.
Fundamentals
for gold and silver have become the incense of reality for
Westerners. The
primary focus is on how many tonnes of gold
China has been importing for the past many
years, the depletion of
available stocks from the central bankers straw
men,
aka the LMBA
and COMEX, the number of coins sold by various
governments to the public, [a relative
drop in the bucket, but its
reporting has a sensation factor], etc, etc.
We address this via charts as the best source
for market pricing information, particularly
citing an example in
silver. As a note to anyone not overly familiar with charts, or
even
turned off by them for lack of understanding or appreciation,
we can tell you that the
markets are full of logic, and we use
charts as a reference to explain how any market will
develop in a
logical way, [never random for those who mistakenly believe
markets are
such], and how that logic can be put to profitable
use.
All
of the collective fundamental factors are important, and they are the
underpinning for
the future performance of the PMs, [Precious
Metals]. They are the substance, but the
smoke they are
producing is clouding the sense part
of the incense.
Westerners see all the
smoke and expect a hand-to-eye coordinated
effect in the markets, in the form of higher
prices, and therein
lies the rub.
For
Westerners, and truest of Americans, gold is all about its
price. Price, price, price.
“What is the price of gold,
today?” “Where is today’s price relative to the highs of
a few
years ago?” Then there is the ultimate question,
“When are
gold and silver going to take
off?”
Gold, in particular, does not have the same
sense of importance for Westerners as it does
for Easterners,
mainly China, India, Turkey, parts of the Middle East. The
elites, born
from the Rothschild dynasty, through their central
banks have manipulated not only the
price of gold, but also the
minds of the masses as they [do not] realte to gold.
Once the moneychangers, [we use various names,
but they all reflect back to the always
clandestine
Rothschild-created group that has been in control of the Western
world money
supply, and by extension, Western governments], once
these moneychangers bankrupted
and gained control of the
United States, they directed the American
proxy-puppetmeister,
Franklin Delano Roosevelt, to shut down the
banking system and reopen it under total
control of the elites.
What
came next? The deceitful scheme of confiscating gold from
Americans, addressed
in previous Commentaries, [See NWO
"Problem-Reaction" Ploy, paragraphs 1 - 4, and
13 -
15, as a recent example]. Consequently, the central bankers
removed gold from the
public both physically and psychologically.
Most Americans alive today have never even
held or touched a gold
coin, so it has no value as a money-related substance.
“Mission
Accomplished” for the elites in ridding its only
competition to its paper fiat Ponzi scheme.
For
Easterners, gold has always been a part of their lives, and they
respect PMs as a store
of value when all else fails. The
price of gold for Easterners? It does not matter.
Owning
it is all that counts, and they keep buying and holding
gold irrespective of
price. Families
are known to keep it for generations.
The
point to be made is Western focus is on the smoke produced by the
incense, and that,
in turn, affects the common sense in
recognizing the importance of owning, holding, and
the ongoing
acquisition of PMs, not because of its price, but for its historical
relevance as
the most effective antidote to fiat currencies, every
one of which has
totally failed.
The
foreign-owned Federal Reserve central bank issues fiat Federal
Reserve Notes, [FRN],
which the Fed deceitfully calls “dollars.
FRN are commercial debt instruments,
in law. If
you know nothing else about money, know
this: debt can
never be money, yet Americans,
indeed the world, has been tricked
into the belief that
FRN are money. A belief about
reality
does not mean the belief is
true.
It is difficult to stay on point when there has
been so much deception by the elites over
every aspect of life in
the Western world. Making one point, the importance of gold
for
example, has so much deceptive background about which few
Americans are aware, some
of what if said does not make sense
unless and until one becomes aware of the deception
that has been
ongoing, not just recently, but since the time when America gained,
[what
almost all do not know was temporary] independence.
If more people realized the importance of
owning physical gold and silver, relative to
holding worthless
fiat paper, they would be better off, but that is not going to
happen.
Even within the PM community, the focus is on how much one
paid for their gold and
or silver, relative to what the price is
today.
The price is where it is today because it has
been purposefully suppressed by Western
central bankers to keep
the “dollar” alive as the world’s reserve currency.
Destroy that,
and gold and silver do, which is why PM are so
despised by central banks, competing
against their paper
enslavement scheme, and the Western banking system collapses.
The
central bankers will not allow that to happen until they have
destroyed every
fiat currency, first, and along with that
destruction, the “value” of whatever people
hold in paper
form: cash, stocks, bonds, pensions, etc. It is in process of
happening
and has been for decades. Right now, events are
leading up to the final phase of the
dollar to undergo severe
devaluation.
People
are focusing on the price of
PMs, treating gold and silver as vehicles for
increasing
in price relative
to their cost
of purchase.
It is the reason for
buying and
holding gold and silver that matters. As a
consequence, attention is paid to what
people think should
happen to the price of
gold and silver, and not on the reality of
what
the artificially suppressed market is showing.
For
that reality, we turn to the charts because the very
legitimate fundamentals that
will
ultimately drive the price of gold and silver are not a barometer for
the timing of
any
future price increases. Plain and simple, gold and silver will
not increase in price
until the socialist/fascist
central planners and their puppet governments have
confiscated
as much wealth as possible from the masses, leaving many destitute.
Know this: It does not matter what you
pay/paid for owning physical gold and silver.
Price is temporary;
physical is permanent.
We caught an early portion of the rally in
silver and gold but exited prior to the larger
gains of the past
week, or so. It has been frustrating to be on the sidelines,
but it never
pays to “chase” a market. The results from
Trade Recommendations for February have
been great, so far, and
none this month’s recommendations were derived from
trying to
catch a rally already underway, as in gold and silver.
No
matter what phase a market is in, there will always be set-up
opportunities that
offer limited risk and a higher probability for
a successful outcome, and that will also
happen for gold and
silver. As ongoing buyers of the physical, we are not too
concerned
about missing a rally or two in a down trending paper
market. It is critical to know that
one should always make
decisions about the reality of a current market and not what
one
may think
will happen in
any given market.
The weekly gold chart is a simple one. A
red flag is in effect based on the increased
volume and the very
small weekly range that resulted. The message from the
market
for this specific situation is that the increased effort on
the part of buyers was met,
even overcome, by sellers who
prevented buyers from extending the range more to
the upside.
The daily shows more detail.
Charts are replete with information about past
activity and how it can possibly influence
present activity.
The rectangular box on the left shows where price declined quickly
from
the 1360 level down to the 1320 area. [Resistance
should always be considered as an area
and not just a specific
price.] The current rally in gold stopped, so far, at the 1330
area.
There are two important considerations to keep
in mind. The upper channel line is a
supply line that
indicates when a market is in an overbought situation. What
many fail
to appreciate is that overbought can become more
overbought, so it is not a reason, by
itself, for making a trade
decision.
The
other aspect is the sharp increase in volume, which happened to
occur at the
overbought supply line at the same time.
Whenever there is a sharp increase in volume,
pay attention.
It is the earmark of “smart money” stepping up activity.
Smart money
buys low, sells high. That is axiomatic.
Up until last Tuesday, the high volume day,
gold made 12 successive higher lows. The
increase in volume
came at the high. Would you surmise smart money was buying
or
selling at that high day? The logic, to which we
referenced earlier for those not too
familiar with charts as we
use them, would say smart money was selling.
Consider
the facts taken directly from the chart. Price was in an area
where it declined
previously, last October, early November 2013.
Price was also at an overbought condition,
converging with these
other two factual observations, as volume had a sharp increase.
A
logical conclusion can be drawn from those facts, [vs
opinions which can be different
from one person to another].
Will
a correction develop soon, next week, based upon this information?
We do not know,
nor is it important to know what may happen,
in advance. We have formulated an idea on
what the market
may do, but we have to wait and see if the market confirms the
idea.
If
it does confirm a correction is imminent, the
next step is to prepare for an opportunity
to possibly be a
buyer. This
approach to the market eliminates guesswork or having to
make a
prediction. Time will tell, starting next week. If the
market rallies more, instead,
we wait again for another
opportunity that will develop. Markets do not disappoint.
There is a growing sense that silver, so often
overshadowed by gold, may be the key for
when the PM begin to
rally in earnest. For all the severe shortage of physical
silver and
mining issues for more supply, etc, the chart does not
reflect any sense of urgency that
silver is about to launch a
major rally.
The issue of bearish spacing still exists, and
the current rally is at the 50% area from the
last swing high to
low. Whenever a market does not rally past a half-way point, it
is a
general indication of overall weakness, emphasis on general.
Silver shows the same sharp volume increase and
very small weekly range, relative to
the effort expended. It
is the daily that shows how charts show the way in which a
market
provides all the information one needs to make an informed trading
decision.
People focus their attention on current market
activity, even to the extent of using intra
day charts as a
reference for decision-making. There is too much “noise”
from an intra
day chart to be consistent. They are not the
most reliable points of reference. It is
always better to
start with the higher time frames and work down.
The weekly chart already indicated a red flag
alert from the high volume and small range
bar. We will
start with that bar, “B” on the chart, but we see that specific
day as a point
of culmination, based upon past market activity.
Just as with gold, silver had a failed
rally at “A,” see
arrow.
We
can see the market declined from that high, but what makes that high
of greater
importance is seeing how the market closed on 30
October. There was a wide range
rally and strong close near
the high. Logically, one would expect upside follow
through,
next day. What happened instead? Price gapped
down, opening under
the low of
that
rally bar, the exact opposite of expectations.
Whenever
the market does something opposite to obvious expectation, that
is an
important message from the market itself! Pay
close attention when that happens.
The market failed to confirm
the expectation. This gives greater credence to that
area
being resistance into the future. When we noted that “B”
related directly to “A,”
you would not have likely made that
pertinent observation.
Further, “A” relates back to “C,” which
we just realized was not marked on the chart.
“C” is the last
failed rally in the middle of September, where there was a very
wide
range bar, followed by a small bar, stopping the rally,
and price sold off sharply, next
trading day.
When you see how “C” acted, it puts “A”
into a context that is less surprising. It is the
combination
of “C,” “A,” and the volume spike that strongly suggests “B”
may also
turn into a decline. By itself, “B” is not as
strong a case for a potential reaction as when
a “story” is
developed from previous developed market activity.
While all of the focus is primarily on gold,
silver is not in as relatively as strong a position
as gold, and
it may be a truer roadmap for when the eventual bull market emerges,
at
some as yet unknown point in the future. Whenever that
rally starts, it is almost certain
that the first signs will come
from the charts, as described.
Stay tuned.
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