Eric De Groot: Earthquakes Before The Price Eruption In Gold & Silver!

Chart: Gold London P.M Fixed and Long/Short Concentration Index (CI): 1 = Bullish Setup, -1 = Bearish Setup

• Gold and silver bugs are suffering immensely right now as the bullion banksters smash the prices down yet again. I am not at all perturbed. The pain may last a little longer 1-2 weeks but it is only minor irritations in the scheme of things. Gold and silver are going alot higher. I still see gold at US$3000-3500/oz with a long-term (3-5 years) target of US$10,000/oz. Silver is heading towards US$75-100/oz with a long term target of US$450/oz.
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• Eric De Groot is correct. What we are witnessing are the tectonic earthquakes (price suppression) before a major volcanic price explosion upwards. The greater the earthquakes the higher the volcanic eruption! The bullion banksters are manipulating the prices lower to cover their shorts. Do not be afraid. Fear is your greatest enemy. Stay the course, do not sell out! This is war and the bullion banksters are losing and are bailing out!
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  Earthquake Before The Price Eruption In Gold ! 
  by Eric De Groot, http://edegrootinsights.blogspot.com/
   Mount St. Helens experienced a magnitude 4.2 earthquake on March 20th 1980. By March 27, steam started venting on March 27th. Yet, how many residents of Skamania County, Washington, U.S. anticipated the following:
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  On May 18, with little warning, a second earthquake, of magnitude 5.1, triggered a massive collapse of the north face of the mountain. It was the largest known debris avalanche in recorded history. The magma inside of St. Helens burst forth into a large-scale pyroclastic flow that flattened vegetation and buildings over 230 square miles (600 km2).
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  Today the line of despair for gold, silver, and the mining shares stretches as far as the eye can see.  Negative headlines reinforced by seemingly endless decline have motivated many within to sell their long-term holdings while muttering NEVER AGAIN!  Unfortunately for them, the precious metals markets, similar to Mt. St. Helens in early 1980s, are beginning  to record significant seismic activity in the futures and options market.  This activity suggests a major, upside price eruption in the months ahead.
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  Statistical significant tremors have preceded every major turn in the secular gold bull (see chart).  The latest earthquake recorded on May 8th 2012 represents the 9th tremor since 2001.  Yet, investors distracted and confounded by statements such as caves might be a better investment than gold are more likely to be spelunking and filling up Jim’s email box than the interpreting the market’s bullish message this weekend.

Chart 1: Silver London P.M Fixed and the Silver Diffusion Index (DI)

• Earthquakes Before The Price Eruption In Silver Coming! 
  by Eric De Groot, http://edegrootinsights.blogspot.com/ 
  Silver will be the key to timing precious metals in the coming weeks.  Silver diffusion index which surged to 75 suggests massive inflows (long buying and short covering) into price weakness by the invisible hand (see chart 1).  This is extremely bullish.
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  The invisible hand while focused and busy may not be done. Similar to the gold market, earthquakes before the price eruption tend to precede major bottoms (see chart 2). The silver volcano while rumbling and venting gas has yet to record any significant seismic activity.  It’s coming and only the perma-bears won’t feel them.

Chart 2: Silver London P.M Fixed and the Silver Long/Short Concentration Index (CI): 1 = Bullish Setup, -1 = Bearish Setup

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