Saturday, February 9, 2013

9 Feb 2013

 Silver continues to coil.  Shorter term view below.
The red line could be broken for another touch of the white longer term trendline from 2008.
 Gold broke its long term trendline from 2008, but this is normal in bull markets before more quickly rising phases begin.  I'm not saying that its not a bad thing that it did or that we will have new rising phase soon.  Just saying its normal.  We need it to break through the yellow trendline.  Short term view below.
If it breaks through the white line, further selling could occur.  The green line is the same as the yellow above.
 This is a collection of long term indicators.  I'm surprised to see there is still a slight decline from recent (2009, 2010, 2011) previous peaks.  The third puts it into context with 2006 / 2007 levels.
We've had slight declines in the short term indicators recently.  The Composite indicator (4th down) includes all time frames.  We are at extreme levels.  The odds of being successful on longs in the near term are dwindling.

Courtesy of
"In a system...where the entire continuity of the...process rests upon credit, a crisis must obviously occur -- a tremendous rush for means of payment -- when credit suddenly ceases and only cash payments have validity. At first glance, therefore, the whole crisis seems to be merely a credit and money crisis. And in fact it is only a question of the convertibility of bills of exchange into money. But the majority of these bills represent actual sales and purchases, whose extension far beyond the needs of society is, after all, the basis of the whole crisis. At the same time, an enormous quantity of these bills of exchange represents plain swindle, which now reaches the light of day and collapses; furthermore, unsuccessful speculation with the capital of other people; finally, commodity-capital which has depreciated or is completely unsaleable, or returns that can never more be realized again. The entire artificial system of forced expansion of the [economy] cannot, of course, be remedied by having some bank, like the Bank of England, give to all the swindlers the deficient capital by means of its paper and having it buy up all the depreciated commodities at their old nominal values. Incidentally, everything here appears distorted, since in this paper world, the real price and its real basis appear nowhere, but only bullion, metal coin, notes, bills of exchange, securities. Particularly in centers where the entire money business of the country is concentrated, like London...the entire process becomes incomprehensible."
-- Karl Marx, "Capital", Volume 3, Chapter 30, "Money-Capital and Real Capital" 

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