By Catherine Austin Fitts
November was not a strong month for precious metals. The current trends in the market have me concerned.
In last month’s Precious Metals Market Report, Franklin and I discussed the importance of various support lines, including the prior low of 1180.
C. Austin Fitts: So, Franklin, assuming we’re still in a primary trend up, how low could it go to still be in a primary trend up before you break through and you say, “Okay, no, this is not a consolidation; this is a bear market.” What’s that line?
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Franklin Sanders: I’ve got a monthly chart up there. If you get that monthly chart in front of you, you’ll see that the uptrend line on that monthly chart – which would be just a little bit different than a daily chart – shows that $1,179.40 low did not reach all the way to the uptrend line. I would have to see a 3 percent violation of that line to say, “Well, maybe that’s it. Maybe it’s all over.”
C. Austin Fitts: And where is that?
Franklin Sanders: Well, if it violated that $1,180 low by more than 3 percent, that’d be pretty bad, but that would take it to 0.97 times $1,180.
C. Austin Fitts: $1,144.
Not wanting to risk getting caught in “rush hour traffic” I decided my line in the sand was 1,200. If the gold broke 1,200, it would be advisable to sell everything but core holdings. (See my post “What Percentage of My Assets Should I Hold in Precious Metals?” for a description of core vs. investment holdings.)
When I had dinner with Rambus of Rambus Chartology last Tuesday, I discovered his important support line was also 1,200. He kindly gave me permission to reprint a chart from his recent post, “Friday Night Charts…Gold and The Most Incredible Chart”
(Click on image to view larger)
If gold moves below 1,200, you want to give serious consideration to reducing your holdings down to your core position or hedging your investment position, if you have not already.
Max:
Not sure I understand.
My position is that if gold breaches 1200, best to sell down to the core. What is core differs for each person, as explained in detail in my prior post which is linked above.
I would prefer to shift out of all investment positions at that point, and then buy back in when and if the primary trend reasserts.
Is that not clear?
Catherine
I suspect you Catherien, and Franklin, are unwilling “con artists”. We listenrs want to be helped in our decisions, like” to stay ,or not”
“To start buying again. etc. But, the future is not much help to any advisor, with so many variables.
Chri s Martensen quotes Kipling, on :” on being a man”, and so we all face the dilemena, of tomorrow and the future.
Thanks for your words of wisdom , anyway.