Dazed and Confused

That’s what hyperinflation gold bulls must be feeling; dazed and confused.

Certainly, we all know from a long-term macro perspective, all fiat currencies go to zero. 

It took the Roman Empire somewhere around 300 years to debase their currency to zero.

So, it’s what happens in-between; that’s the important part.

The old trading books like Reminiscences of A Stock Operator and Studies in Tape Reading are replete with speculators being on the wrong side of the trade.

Some of them realize the error, get themselves righted and back on the direction of trend.  Others, like in one Livermore example (the cotton trade) go bankrupt.

Just to see how big the hyperinflation crowd is, we’ve added up the total number of subscribers to bullish YouTube channels listed in this update

That list for sure, is a small fraction of bullish ‘content’ available.  At a total of 674,000 subscribers, it’s already a huge number.  The actual size of all such content is most likely in the millions.

Note the word “content”, is amorphous.  It just means ‘there’s something in there’.  It does not mean that ‘something’ is of any use. 

When reading through the old trading stories, we see the great speculators operated alone. At times, they employed a support staff of ‘board boys’, writing quotes down on the chalk boards but not much else.

If you’re alone, direction changes happen instantly. Changing direction that fast for millions … not a chance.

At this time in the pre-market (9:03, a.m. EST), gold (GLD) is set to open lower with GDX indicating lower as well.

Looking at the chart of GDX, we’ve got a possible trend line. 

Such lines make things a bit easier.  If there is confirmation on the way down, we maintain the DUST trade (not advice, not a recommendation); until the trend is broken.

Current stop (not advice, not a recommendation) is set at DUST 18.92

Charts by StockCharts

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.
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