by The Doc and Eric Dubin, Silver Doctors:
With Super Mario Draghi dropping a bomb on global financial markets Thursday, Doc & Dubin welcomed Alasdair Macleod out of London back on the show to break down the implications for the markets, gold, and silver:
On Draghi’s Bazooka QE: “It’s actually quite terrifying…“
On Gold: There is a Golden Cross Underneath a Rising Gold Price, as well as a Pennant Formation! We’re looking at a minimum gold price of $1400, and it could happen quite quickly…
To my surprise, we didn’t see much Federal Reserve jawboning this week. We certainly had the perfect set-up for flapping gums. Perhaps Fed officials were laying low as the ECB and Draghi took center stage? In any event, the Federal Open Market Committee (FOMC) meets next Tuesday and Wednesday to discuss interest rate policy. It’s very unlikely the FOMC will decide to hike rates.
Most analysts and pundits in the precious metals camp are uneasy, expecting a big correction and/or cartel smack-down at any moment. I’ve outlined a few set-ups where risk for another attack has been elevated, but each time we do see profit taking and cartel capping, buying overwhelms it and at worst, we have trended sideways on a weekly basis. You can see this most clearly in the gold trade from March 3, onward. The cartel uses time in its favor, attempting to exhaust momentum and as we move through these sideways consolidation patterns, a veritable paper issuance fiesta is underway (COMEX and beyond), absorbing rising paper demand. However, both paper and physical demand are not letting up, and the stalling to dilute momentum tactic hasn’t worked.
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