MAJOR MARKETS WARNING! AND THE GOLDEN STRATEGY
by DeepCaster LLC
March 16, 2007
Deepcaster recently issued a Forecast that there is a high probability of Major Moves in several Key Markets in the next few days.
In Deepcaster�s view these impending Moves provide an opportunity to profit from a position in Gold. But it is essential to Forecast the direction of the prospective moves correctly, of course, in order to know WHAT position to take, whether short or long.
Indeed, Gold may provide a profit opportunity whether the specific markets, which we are about to address, turn up or turn down. But it must be used very differently in each case. So let us consider WHY and HOW. �Linked� Markets
The evidence indicates The Cartel of Central Bankers treats the Gold market and certain other key markets such as Crude Oil and the major equity indexes as linked.
This is because, for example, if they wish to take the Equities Indexes and/or the Crude Oil prices down, they could not allow Gold or Silver to be used as refuges for money coming out of Oil and equities.
They could not do so, because to allow Gold and Silver to rise as Oil and Equities fell would allow gold and silver to be �competitors� to their Treasury Securities. This they would strenuously resist. Thus they must, in this linkage scenario, take Gold and Silver down simultaneously too.
So, in the event of such linked moves, how can Gold be used as such a profit opportunity?
To answer this question Deepcaster will enunciate a position which is abhorrent to some Partisans of Gold.
But it should not be. Deepcaster too is a Partisan of Gold.
But the sad fact is that the overwhelming weight of the evidence is that The Cartel of Central Bankers still controls the gold price, virtually at will. And Investors should deal realistically with this fact.
Fundamentally, Deepcaster and other Tangible Assets Partisans believe that gold and silver are the Ultimate currency (i.e. both a store and measure of value) and thus best hedge against inflation and deflation. We believe investors should buy physical gold and silver near the bottoms of Cartel-generated Takedowns to hedge against coming uncertainties, provided that Investors also seriously consider availing themselves of other opportunities to profit from Gold, such as those described here.
Thus, the foregoing injunction to buy physical near Takedown bottoms is substantially informed by the fact that The Cartel (whose �operating arm� is apparently the Working Group on Financial Markets, also known as The Plunge Protection Team) of Central Bankers sees gold, silver and other Tangible Assets such as Crude Oil as serious competitors to their Treasury Paper and Fiat Currencies regimes.
Therefore, the overwhelming evidence (much of which has been gathered, laudably, by The Gold AntiTrust Action Committee - - see gata.org) is that this Cartel has for years been taking down the price of gold and silver periodically in a manner which injures Tangible Assets Investors.
Why not profit from the Takedowns as well as the Runups, if one can?
The aforementioned facts provide the basis for the following Golden Strategy from which Investors can profit.
The Short Side
When Technical and Interventional analyses both indicate the likelihood of a Cartel-caused Gold Takedown coupled with a takedown of a market linked to gold (or one which would move correspondingly - - see above) the prudent course is to either be out of the market or be short gold. Among several ways to be short gold are: selling major gold producers such as Newmont Mining short, or buying puts on Newmont, or buying puts on gold bullion in the futures market, provided one is comfortable with the substantial risk which options entail.
Thus, for example, if one forecasts that the major stock markets are about to suffer a significant decline, then one could profitably hedge that decline by buying puts on the gold producer Newmont Mining, if one expects, as Deepcaster does, that the major gold shares are �linked� (as described in the hypothetical above) and thus will decline as well.
The Long Side
If on the other hand, one forecasts that the near-term prospects for gold are positive, and, if the prospects for �linked� markets do not contraindicate this view, then Deepcaster also advocates buying physical gold, preferably in the form of Gold and Silver Coins. But this should be done only near the bottom of Cartel-caused Takedowns.
Owning physical gold is an arguably less risky venture in the long run than owning shares of gold miners which are more easily subject to manipulations and takedowns.
For example, we have previously noted the borrower/lender relationship (for precious metal shares) between Oppenheimer Co. and J.P. Morgan Chase. And we have asked why such a share lending relationship would exist if it were not to make shares available for massive takedowns directed by The Cartel? No one has had a satisfactory answer to this question other than they are to be used exactly for that purpose.
Thus even though The Cartel may take down the price of gold shares and physical gold periodically, having physical gold is a tangible reserve of safety for the long run.
The more physical gold that is in the public hands, the harder it is for The Cartel to manipulate the markets in the long run. Deepcaster prefers holding physical gold and silver in the form of gold coins such as Eagles, Krugers and Maple Leafs. In the case of silver, we recommend bags of �junk� silver, as in pre-1966 90% silver 50-cent pieces and quarters.
The Situation Today
Of course, the key question is always �Which way next?� Determining whether it is time to buy puts, sell short, or stand aside (if one believes a particular market and �linked� markets are going to decline) or whether it is time to load up on physical if one believes a rise is coming. Making this decision requires using technical and interventional analysis.
Today, most indicators point to major moves coming soon in Gold, Silver, Crude Oil and the Major Equities Markets.
�Lure� or Pretext?
In determining how to play these moves it is well to remember that The Cartel quite apparently likes to use (we reiterate) technical patterns (e.g. Fibonacci retracement levels, Head & Shoulders, etc.) as �lures� to lure in precious metals and strategic commodities longs and then to take them down. Longs in these circumstances are literally the hens led into the slaughterhouse by technical �lures.�
Similarly, however, The Cartel also uses such Technical Patterns as pretexts for their Interventions to create Plausible Deniability for their Interventions.
Today, particularly significant are Technical Patterns which foreshadow Major Takedowns. For example, the Dow Jones long-term multi-year chart shows an �expanding megaphone� chart with the index at the very top of the �megaphone� and ripe for a takedown of perhaps up to 2000 points on the Dow. Of course, the PPT might not allow The Takedown to be that substantial.
There are several other technical patterns which also suggest a Takedown, including an expanding ascending wedge and the MACD which are both generating a bearish signal.
But it is Interventional Analysis which is critical to the judgment about whether these aforementioned Technical Patterns are a �lure� or a Real Harbinger of a move soon to come.
Thus, Interventional Analysis has been and is crucial for Deepcaster�s specific Forecasts (at www.deepcaster.com) regarding these Major Moves, which Deepcaster expects to begin in the next few days.
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