With continued volatility in gold and silver, Richard Russell, the Godfather of newsletter writers had this to say in his latest commentary, “There was the incredible cheering and gloating about the fall of silver. The media and various experts were laughing and giving the "high sign" in reaction to the 30% decline in silver. The only regret seemed to be that gold didn't sink 30% along with silver. And I wondered why all the cheering over silver's decline. My conclusion was that actually very few people were "in" silver and when silver rocketed up to near 50 dollars an ounce, most investors' reactions was "sour grapes."
“And they grumbled, "Who were those damn buffoons who made a killing in silver over the period of only a few months?" When silver plunged from 49.75 to 33, down by a third, the anti-precious metals crowd cheered. Of course, the drop in silver and gold was accompanied by a plunge in oil and many other commodities, which elicited a few sighs of relief.
I don't think I've ever seen so much gloating in the face of a plunge in a sector of the market. And I wonder, just wondering, whether silver will now cross up the crowd by bouncing back to a surprising degree.
Gold, as you can see on the chart below has been advancing above an ascending trendline. Over the last two years, gold has declined to test the trendline twice (red arrows). As I write, gold, despite recent weakness, is still well above its bullish trendline.
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