Silver - Once in every 65 years - Where is the real bubble?

FX:XAGUSD   Silver / U.S. Dollar
555 4 9
Yes, once in every 65 years it may happen that Silver             falls for 15 days with no retracement at all!
But why are we surprised by such a statistics data? Once in every 1000 years it may happen that CBs             print 6000 bn USD equivalent of money out of thin air and that doesn't have any serious consequences on inflation and effect on real economy, but at least European bonds trade at negative yields (!) and SPX             is at all time high, and we have planty of real estate bubbles all around the world.

I want to point for something here: Is the USD so much better value to hold? I mean the Dollar, which has been printed for not just 6 years (due to recent FED ZIRP and QE programs) but for the last 40+ years (due to huge C/A deficit and ever increasing debt)? Or the EUR??? I am asking it because Silver             and Gold             not just tanked against the USD but also against the EUR, which is being printed now! Or GBP??? Or JPY???

Ladies and gentlemen! The real bubble is not in the Equity markets, not even in real estates (or other real assets).
The ultimate real bubble of modern history is now CASH (fiat ccys) and BONDS with negative yields, which is even worse, as that is a cash promise only with negative yield so a promise to be payed out in some fiat ccy at an even lower, more negative real rate!!!

Sooner or later the world's savers will realise how they are being robbed out by central banks and governments!

I dunno how deep Gold             and Silver             will go. I see they are bearish . But I rather take those into my portfolio than any negative yield bonds and too much fiat cash.

- Ichimoku bearish , but mkt got oversold. Price too far below Kijun
- EWO             is extremely low.
- Heikin Ashi signals possible start of consolidation.
- Pull back and short covering rally may happen above 14,30

- Ichimoku is still bearish . Price is below Kijun Sen. Also 100 WMA is too high and Kumo is still thick. But Tenkan/Kijun started to converge. Maybe bottom building starts.
- Heikin Ashi suggests further consolidation or maybe one more dip down from Kijun. Watch if haDelta stays above zero.
- EWO             is building a positive divergence
I do think despite so the bubble in FIAT/Cash still have some room to run.

Look at this perspective:
There are over 100 trillions of derivatives in stocks and bonds alone detonated in USD. Should we get a full blown panic and collapse, USD will surprisingly be rising first due to people cashing out instead of collapsing.
What will happen next is then a flight of safety, when USD are immediately converted to precious metal.

I wouldn't go 100% into gold and silver yet, but I'm waiting for that specific window of opportunity holding some cash. Eagerly waiting to hit the buy on silver.
Silver and Gold currently consist of 30% of my portfolio.
Kumowizard LastBattle
of course me neither would put all my wealth to Gold and silver. But I don't like USD here. There is also a risk in the future that it will lose reserve ccy status, as Chinese Yuan will take place as a new reserve ccy. The other risk what I see for USD next year is that very likely Republicans will win... and that means Trump... what do u think that guy will do to US budget? I think he'll be the next Ronald Reagan.
But still, the biggest joke in my 15 years+ trading career is that Italian bonds upto 2y trade at negative yield :-D
Also France is a joke. This mkt is totally distorted by ECB.

My portfolio only has like 7 % Gold. (from 1160 avg). But 5-7 % is a kind of minimum amount I always keep. Then from time to time I play with buying more, and selling that ballance. (that's how I pulled down the avg price).
+1 Reply
Kumowizard LastBattle
One more thing is extremely important in trading/investing. Probably one of the most important rule: Always trade the price action, not our hopes and beliefes! When anyone starts to think on macro basis, or does speculation, may be correct, but may not be precise in timing! So even though I think this bond bubble will be the biggest burst of history, and I think equity mkts have high chance to enter a bear mkt next year, I can not allow myself:
- to trade without stops
- to go against the otherwise bullish trend too early and too big.
- Short at any price with no proper wave exhaustion / counter trend signals.

Actually I should follow the mkt and go long equities. But then I may switch into a bullish bias unnecessarely too late, after several years of bull mkt. So I either short on swing sell signals, or cut shorts and do nothing in equities. This is not very good, as I should be as flexible there as in FX or commodities, but I have become very much biased during the years :-). Strangely in some individual equities (espec in my country) I never short, and I am happy to buy from time to time. But only if I consider them relatively "cheap", compared to the globel bubbled peers.

So the message is: stay flexible, be very patient and trade only price action and system signals!
+1 Reply
gbfx Kumowizard
Thanks you guys for these great insight. Trade what you see and Not what you hope "flexibility"...thanks
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