I have said this in other venues of mine, unassociated with this business. But let me say it now, so it is recorded here at my new stomping grounds and sandbox of Sharpe Trade.
I am a directional trader. I think in time-frames, for such directional trades. I say this because there are many ways to trade, and I speak through the lens of the style of my approach the markets (which I believe is also the attempted style of the majority of self-directed retail traders).
So with that long preamble let me say for the record …
Long term, I am bearish on Gold.
Long term, I am bearish on Silver.
Longer term and at the present time, I can see absolutely no reason whatsoever to get involved in the long-side on either of these two metals. Unless, maybe … a trader is playing some sort of skewed spread, and a long Gold or Silver position is part of such a spread. Or, it could be placed in an all-weather strategy like permanent portfolio.
But such a stance would not be very ‘directional’ would it?
And of course ones could go long, on very short-term order flow, or playing a very short-term counter-trend trades, with all of the risks associated with such trading. Speaking of the short-term, I have to believe that we will see a mean-reversion rally at some point.
But such a trade would not be very ‘long-term’ would it?
When will such rallies occur? I have absolutely no clue. As you may or may not know, I’m a trader. So I am not in the prediction business. I’m in the business of managing risk.
However, returning to the point as we are speaking of the longer term time-frame, when we see such rallies develop, I believe, as all bear market rallies are, they will be very explosive and very short-lived.
Tonight, I’m watching both of these metals turn over and head lower during the Asia session.
As stated, I can see absolutely no reason to get involved in the long-side of Gold or Silver, as I have been saying since I sold out of all Silver positions at $43, years ago. I have been bearish on the metals for years, as well as up to just a few months ago.
So now? Longer-term … I remain a bear, looking for low-risk opportunities to get short until the market price tells me something different.
And unless something dramatically changes (which it can, at any moment), I can see, eventually, Gold prices of $850 and Silver prices of $6.50 per ounce.
Disclosure: I have no current position in Gold or Silver, long or short at this time in any portfolio’s that I manage. No businesses that I am associated with, to my knowledge, has any position in Gold or Silver, long or short, at this time. My Immediate family has no current position in Gold or Silver, long or short. I am not looking to establish a position in Gold or Silver in any direction within the next 24 hours.