By Brien Lundin
Editor, Gold Newsletter
CEO, the New Orleans Investment Conference
Editor’s Note: With the recent drop in precious metals prices, we have reached out to a number of our friends in the industry to gather perspective on what’s happening and what’s next. Today, we turn to Brien Lundin, long-time friend, market analyst and organizer of the ‘Grandaddy of All Conferences,’ the New Orleans Investment Conference, for his take on things. Brien is a clear thinker, and I believe you will benefit from his insight.
After all, Brien has been carrying the torch for hard money for many years… a torch originally handed to him by the indomitable Jim Blanchard. Jim is credited with lighting that torch for the hard money movement with his efforts to legalize gold ownership in the 1970’s. Michael attended the very first New Orleans Conference run by Jim, and we have been attending ever since. For the value delivered, it is an absolute bargain.
Take a look at Brien’s comments on the gold market below. Then, register to join me in New Orleans this October via the link provided below. I look forward to seeing you there.
-Rich Checkan
You’ve no doubt seen the blood in the streets of the gold market. Well hang on, because the price of gold could go even lower.
The good news: This could be one of the greatest opportunities we’ve seen since 2001.
And I’m going to show you one of the best ways to take advantage of it right now....
Ambushed In The Dead Of Night
This latest attack on gold is the most vicious we’ve seen since April 2013. It may also be the most obvious, bald-faced price manipulation we’ve ever witnessed.
And it may bring the bottom we’ve been long awaiting.
One of the things that concerned me over the past few months was the level of complacency amongst metals and mining stock investors. As I’ve noted, almost everyone in the industry has been singing the same refrain: “We’re bouncing along the bottom, and it’s only a matter of time until the next big up-cycle. The timing is the only thing in question.”
I couldn’t argue with that outlook. In fact, I agreed with it, as did every smart investor I knew in the industry.
But still, it bothered me...because it had become the consensus view. And we all know what happens to the consensus view.
And so it came that the “bottom” we were bouncing along was nothing more than a false floor...and we fell right through it.
Or rather, we were shoved through it, by a brazen, obviously orchestrated and illegal short attack just as the Chinese market opened Sunday evening. In a flash — literally, as it was a classic flash crash — gold was forced down nearly $50, to right around $1,080.
Interestingly, as ZeroHedge noted, $1,080 marks a multi-decade channel support level on some technical interpretations. So, that may be the target the shorts were aiming for.
But gold recovered more than half of that loss during the regular trading yesterday, trading as high as $1,119.90, before taking another late-day plunge. By the end of it all, gold settled down $35.60 (3.14%) from Friday’s close to $1,097.70 bid.
Gold was obviously the target, because the other metals merely fell in sympathy. Silver closed down $0.17 (1.15%) to $14.67, platinum lost $13.00 (1.31%) to $978 and palladium dropped $9.00 (1.47%) to $603.
The gold stocks were slaughtered: The Gold Bugs Index fell a stunning 15.49 points (12.05%) to 113.07, while the XAU plummeted 5.57 points (10.27%) to 48.63.
If this isn’t capitulation, I don’t want to know what capitulation means.
And that’s the key point — the consensus view that had been so prevalent before yesterday was nothing like the kind of capitulation that you need to reach a real market bottom.
Maybe we’ve reached that point now.
Since Monday’s rout, the metals and mining stocks have generally rebounded. The question, of course, is where gold goes from here.
The near-term answer would require knowledge of why gold crashed during the thin, Chinese trading hours on Monday. Obviously, the goal of the gold dump wasn’t to maximize the price gained.
So was it margin call related, as some have claimed? Or was it a short-attack designed to drive the price through sell-stops, to send the price cascading down to much lower levels?
Considering that even margin-call selling is rarely urgent enough that it couldn’t wait a few hours for a deeper market and better prices, and that nothing had occurred in the market Friday or on the Monday opening in Asia to prompt such selling in the first place... I lean toward a short-attack as the proximal cause.
In that case, we could expect a follow-on attack, to see if the market is weak enough to prompt another drive lower.
Some pundits, like our friend Dennis Gartman, are saying that gold could overshoot to the downside, resulting in an “obscene” number like $995 or thereabouts. I won’t say this can’t happen (after all, I didn’t expect yesterday’s sell-off), but I’ve found that big drops like this often bring out bold predictions to the downside that never come to fruition.
So we could have more declines, especially if the shorts mount another coordinated flash crash (knowing that they can do so with impunity... but that’s another story). But I expect physical demand to rise to the occasion, and limit the damage.
At some point, the shorts will have to cover, and this will quickly send gold significantly higher.
Looking further down the road, we can expect higher prices in the fall, as seasonality comes into play.
All of this argues that, for those with cash and courage, buying top quality gold stocks and physical metals at their current over-sold levels will be a highly rewarding experience.
But Here’s The Single Best Way To Make A Fortune From Gold’s Drop...
The current over-sold situation in metals and mining is such an extraordinary opportunity that I decided to bring today’s most renowned experts together to show you how to profit.
It’s all happening at this year’s New Orleans Investment Conference, being held from October 28-31.
It’s fair to say that there has never been a roster of world-class authorities such as this. You have the chance to get the inside scoop from....
And that’s not all — in addition to these, this year’s New Orleans Conference will feature dozens of top experts, including Rick Rule, Adrian Day, Frank Holmes, Marin Katusa, Sean Brodrick, Dr. Larry Reed and Brent Cook...
Plus: Mary Anne and Pamela Aden, David Morgan, Mark Skousen, Peter Ricchiutti, Eric Coffin, Gwen Preston, Ian McAvity, Nick Hodge, Chris Powell, Bill Murphy and more.
Throw in our scintillating special panel presentations, our spectacular opening and closing receptions and other celebrations throughout the event, and you get something that we’ll be talking about for many years to come.
But if you don’t act soon, you might miss it all.
That’s because there’s limited room in our host hotel, and we’re about to open up registration to hundreds of thousands of investors worldwide.
So you don’t have months or even weeks to go before you lock in your place at this year’s New Orleans Conference. You need to act immediately.
And get this: If you act now, I can guarantee you a free spot in our exclusive Gold Club. That’s a $189 value for you and each of your guests...at no charge.
Plus, you’ll save up to $400 by registering now.
So call us toll free at 800-648-8411 to lock in your spot, and mention Asset Strategies to get your discount and free Gold Club status.
Or, CLICK HERE to register online, and be sure to enter FREEGOLDCLUB in your promo code.