On 9/1 I shared the chart below, reflecting that the Swiss Franc was up against a resistance line that had held each time over the past 30 years and that Gold was at the top of a 10 year rising channel.  I also discussed that if the “Power of the Pattern” and history was any guide, both of these assets should decline in price. (see post here)


Why did I chose an image of a man yelling in the phone and saying “No Way?”  I suspected their would be a large crowd reading this post and the photo/caption would reflect their opinion/sentiment.  Even though 100% of the time over the past 30 years Gold had declined when the Franc hit this line, could it be different this time?  Sure anything was possible, yet the patterns reflected a high chance, it “would NOT be different this time around!”

So what has happened in the following 25 days since that post?  Both the Swiss Franc and Gold have experienced their largest short-term declines in 30 years.  Bloomberg reported that Gold suffered its largest two day decline since 1983 this past Thursday/Friday.

Friday the chart below was suggesting that Silver could still fall further to a key intermediate support line around the $27 and investors that are short Silver would want to look to do some harvesting at this key level.


I have received numerous emails asking where Gold would look to find similar short/intermediate support.  For those viewers that are short Gold (owners of GLL) due to this quiz (see shorting Gold quiz here) below is an update on the Gold charts.



Gold should find some intermediate support around the $1,500 level.  For those scoring on defense, this would be a good place to look to harvest some of those gains.  Keep in mind that GLD become the largest ETF in America last month, which reflected a VERY CROWDED TRAIN! (see post here) With so many people piling into GLD at these key resistance level, selling pressure could be bigger than many suspect!

Gold lost 25% of its value in the GE1 (great escape part 1), a similar decline in GE2 (Great Escape 2) would take it down to $1,425.  See why markets are under GE2 pressure (see post here)

How The Recent Decline In Stocks Looks "Eerily" Like Major Bear Markets Of The Past