Betwixt and Between Market Action Ending Soon …

Lots of sideways, betwixt and between market action over the last couple of weeks. What does it mean? When will it end? What will be the next moves in gold, silver, the dollar, the Dow Industrials?

Check out my video update on the key markets now. You won’t want to miss it.

Best wishes,

Larry

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Video Transcript

Good morning. This is Larry Edelson for my Uncommon Wisdom video market update for Monday, April 2.

The markets, all of them literally, have been betwixt and between over the last couple of weeks. Chopping sideways. Looking at times like they are going to break out to the upside then failing. Moving lower, looking like they’re going to literally plunge at any minute. And then holding support and bouncing back.

This is very frustrating action for most traders and investors. However, I will tell you on a positive note that, when you see sideways action like you’ve seen in most of the markets, that of course is usually a prelude to a very big move.

And on another positive note, I do see this betwixt-and-between action — this sideways action — coming to an end very soon, probably by the end of this first week in April.

I want to go to the charts now. First, the gold chart. This is the gold chart that I’ve had up for the past month or so and been using to show you the action in gold. As you can see here, this is the rally that failed in February and failed to give a monthly buy signal.

Gold started to drift lower and is now pretty much in no-man’s land between support down here and resistance up here. I will tell you that the March closing for gold was not bullish, but it wasn’t very bearish either. So that’s indicative that gold is still in a sideways market, drifting lower.

I do expect as I just indicated that we will start to see some action soon in gold and all of my indicators point to a resolution of this sideways action to the downside.

Having said that, let’s now take a look at silver. Silver looks very similar to gold. The rally failed back here, which I showed you. Silver failed to give a monthly buy signal at the end of February. Since then, throughout March we’ve been drifting lower in a choppy, sideways slightly lower action.

It does look at times that silver’s going to collapse; yet it continues to hold support around the $32 level. Like gold, I expect a resolution to this sideways action in silver and very soon, probably by the end of this first week in April.

All of my indicators continue to suggest that another sharp decline in silver is the most likely outcome.

Now let’s move on to the U.S. Dollar Index. Again here, we’ve seen the dollar weaken to test support. But not a very impulsive decline here — rather, drifting lower. It looks kind of sharp on the chart, but it’s been a rather slow decline to support here.

I do believe we will hold this level of support and the next move in the dollar, which should come very soon, should be to the upside.

Now the Dow Industrials. The Dow Industrials are really holding support magnificently ever since we closed above the 12,849 level. The Dow being the only market that gave a monthly buy signal at the end of February, as I’ve indicated to you before, and now it’s consolidating.

Many of my indicators suggest the Dow and the broader stock markets in general are overbought and we should see some kind of correction. If you’re one of my trading subscribers who attended last week’s Resource Windfall Trader webinar, I did indicate to you that Dow 9,100 is now off the table.

I do expect some kind of shakeout in the Dow before the full force of the bull market of the Dow hits. So I wouldn’t be surprised to see a move down in the Dow. But it’s really quite fascinating how the Dow was holding this support area here and looking so rock-solid.

Even if we get a dip, a correction, in the Dow, there’s no question in my mind now that a new, long-term bull market in the Dow is forming. One that I’ve been talking about for some time now, and it will see the Dow and broader stock markets move substantially higher over the next few years as a result of the European sovereign debt crisis and the U.S. sovereign debt crisis.

The money that will be coming out of European bonds and U.S. government bonds has to go somewhere and it’s going to seek out safety, capital appreciation and income in the way of dividends and royalty in the stock market in addition to gold in a safe haven going forward. So keep that in mind.

Stay tuned to all my writings and have a good week.

Your thoughts on “Betwixt and Between Market Action Ending Soon …”

  1. Larry, you indicate that gold and silver are headed south by this first week of April 2012. Looking head, should we keep our holdings in gold and silver, or is it time to sell?

  2. The issue is what kind of effect money printing will have on stocks value, because there is no economic growth in the developed world, only money printing. If money loses value, stock prices will go higher as they are expressed in a devalued currency, so the bullish argument goes. However if we are going to have inflation then we will have high interest rates which will crash the market, and this is the bearish argument.

    1. When/If inflation hits…this will actually catapult the markets inot the stratosphere….its gonna take more dollars to buy the same asset..

      repeat…inflation will not crash the markets but actually be the catalyst for pushing the DOW to 20,000-25,000 and beyond…

  3. Larry,

    If money comes out of US Treasuries, will that not force the fed to raise interest rates or do you expect them to just print the money to replace the Treasuries? Any rise in interest rates would damper the market, would it not?

    1. The Fed will have to print Treasuries to keep interest rates: they are the monkeys buying their own debt! Raise interest rates? I almost blew milk out of my nose. Raising interest rates would destroy the wonderful ponzi scheme that is our international banking system.

  4. Larry,

    Also, if the stock market is reacting to the European crisis and Bernacke’s easing, why would not gold and silver continue to trade in the same direction? It would mean Treasury note holders view stocks in a better light than gold or silver as a safe haven. At any rate, a bubble appears to be forming in the markets, wouldn’t you say? And for how long? What is the expectation for first quarter profits and a reviving economy? An artificiallly boosed economy to bolster Obama’s chance of re-election?

  5. I do enjoy receiving the uncommon wisdom updates, thank you. However I have not been able to receive your videos for some weeks, even when I go to your homepage.
    I especially would like to hear your new evidence about the China US plan.
    my broadband should be sufficient. do you have any ideas how to access your videos, please?
    Margaret

  6. Thanks Larry, Enjoy your views on the markets. Particularly enjoyed the China video. Thanks, Norman Coeur d’ Alene

  7. “I did indicate to you that Dow 9,100 is now off the table.”

    Wow … so how long have you been wrong on DOW 9,000? A year? Look out below!

    “I wouldn’t be surprised to see a move down in the Dow.”

    I wouldn’t be surprised to see sunlight tomorrow morning followed by moonlight that evening.

    1. No more Dow at 9000 …. no more gold to $ 1400 …or was it lower ? No more silver to $26 and most likely way below that ….. but heh… lots of Thank You notes for all prev. guesses .
      Truly ? It’s difficult for many writers ( analysts ) these days .

  8. Larry,
    It is not surprising that the Dow Industrial Index is holding up magnificently. Some usually reliable financial bloggers are reporting that the “Plunge Protection Team” of the US Treasury Department is pumping $1.8 Billion per day into the New York markets. This certainly gives the appearance of growth; however, the question remains, “Do you simply rely on the index results, e.g. the Feb 29 buy signal, or do you take into consideration how the results were achieved?” It seems to me that broad genuine public demand should carry much more weight, than government manipulated demand. I enjoy your weekly comment.

  9. Yes, David X, me too I’m tired of Larry’s contradictions! He’s been WRONG, and wrong again, about so many market moves. And then he goes like this: “I know I’ve been wrong about soandso….” and all is well (but only for him again). In the meantime, the ones who followed his advice 101, must have had more losses than gains.

  10. Doesn’t it appear that the government is propping up the market behind the scenes in order to make it appear that the economy is stronger than it really is during an election year?

  11. Larry what about the sell in May and go away, Also the Fed is flooding the market with liquidity(money) to make the Dow look good.. I look forward to your updates……….

  12. Larry,

    Great call on the metals this week, silver and gold down sharply.

    Thanks for all your hard work.

    Jack

  13. The markets seems to be doing exactly what Larry suggested they would do sometime this week. I appreciate his insight. I have been wondering where F.S. has been lately. All of a sudden he seems to have dropped off the face of the Earth. He said he was very old. I hope nothing has happened to him.

  14. Note to anyone holding GLL: its a limited partnership. So the $100 you may earn if gold manages to go down fast enough will require $200 of work from an accountant. All part of our government protecting us from ourselves with new tax regulations. Also, don’t put it in an IRA or your headache may double (this triggers some kind of special set of even more complex IRS rules which I’m about to learn about from my newly hired team of accountants).

  15. LARRY HAS BEEN SPOT ON ABOUT THE GOLD BULL MARKET FOR YEARS NOW. AS THE GOLD STOCKS GO DOWN I HAVE BEEN BUYING ON EVERY DOWN DAY.HE HAS BEEN CALLING THIS SELL OFF OFF FOR A FEW MONTHS RIGHT ON THE MONEY.JIM ROGERS HAS SAID LONG GOLD AND SHORT TECH.THATS THE WAY I’AM PLAYING IT.THE GOLD STOCKS ARE VERY UNDER VALUED AND MAY GO LOWER THATS OK .I THINK IN A YEAR OR TWO THE STOCKS COULD GO FROM UNDER VALUED TO OVER VALUED .LARRY’S VEIW IS GOLD GOING MUCH HIGHER LONG TERM AND HE’S BEEN CALLING IT RIGHT FROM THE START SO I WILL FOLLOW HE’S CALLS GOING FORWARD. THANKS LARRY

  16. Larry,

    I think I have figured out gold and silver. The price of gold and silver goes up about $400, central banks sell some of their gold(not all), the price drops about $400, the banks buy more gold, then the price of gold starts to go back up. If you track the price of gold and siver it seems to be following this pattern. The issues of soverign debt are not going away. The government will have to print more money to pay off all the outstanding debts.

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