Kitco Commentary:What Will Happen to the PM Sector if the Broad Market Tanks...

Maund

Excerpts:

• the market has arrived at a zone of massive resistance approaching its 2000 and 2007 highs, which is as good a point as any for it to turn down.
• the index has arrived at two synchronous trend channel targets and is in an overbought state. Thus it looks like we are on the cusp of a significant reversal.
• If the market is about to go into reverse, can we see signs of it in recent candlesticks? We certainly can.
• One sure indication that a top is close at hand is the appearance of increasingly absurd and outlandish justifications for higher prices.
• Our 6-year chart for the HUI index shows a massive completing Head-and-Shoulders top. We have observed this menacing pattern for some considerable time, but for a while thought it would abort because of the negative extremes of sentiment already afflicting the sector.

That head and shoulders pattern is worrisome.  It is a six year pattern, so that's really significant.

For the stock markets to move down makes sense.  The rally never made sense to me.  But the fall of precious metals does not make sense.

If there's hyperinflation, how does that affect the charts?  You can throw all the charts out the window in that case.  But the charts don't indicate hyperinflation.  They indicate the reverse.

What to make of this?