November 2020
This is our last newsletter in a year unlike any other in most of our lifetimes. Our hope, as I'm sure is shared by many, is that between now and the end of the year, things will settle down and we can enjoy the Christmas season with our families. Something tells us that the settling down part may be too much to ask. As such, we have decided this newsletter will be a little different. The noise out there is deafening. There is no shortage of sources analyzing current events and we don't feel the need to add to the "noise" at this time. By January, we should have a clearer picture of what lies ahead.
Therefore, we will provide our usual analysis of the gold and silver charts and leave it at that. It turns out they have quite a bit to say, which is one reason the newsletter is a little late this month.
Enjoy,
The OWNx Team
X-cerpt
Hello Friends,
Here we are, coming down the home stretch to the end of 2020. If this year has taught us anything, it is that reality has some competition, at least, that is what some would like us to believe. More on that in a minute. On a separate note, does anyone else find it difficult to believe that after 50 years, the Kansas City Chiefs finally won the Super Bowl again?! February seems like years ago! That begs the question, could people who don't closely follow the NFL be convinced that it happened in a different year?
I didn't plan to go into this when I sat down to write this Xcerpt, but let's consider something for a moment. Assuming enough incentives were in place, it is probable that a significant portion of the population could be convinced that the Chiefs won the super bowl in 2018, or 2017. It is especially true in a year filled with disorienting factors unleashed via “The VID” aka COVID. Can we call it "The VID?" It sounds more intimidating that way, which in itself would be a disorienting factor. Next, the new narrative would be shouted persistently and repetitively from a competing set of authoritative voices across the media spectrum. Tie it together with the intentional skewing of search results for people making a half-hearted attempt to verify it and there you go... A certain group of people would have their reality changed. This seemingly silly thought experiment may a bit out of character from past newsletters, but it sets up what I’d like to share.
Going into 2021, one of the great challenges we face is getting grounded in reality. One that has weathered many past storms. One where our hearts and minds can’t be shifted by the storms. When we are rooted spiritually, relationally, emotionally, and financially, it creates a foundation of peace in any storm. At OWNx, we are big on family. It is something that has weathered storms throughout history and, for most people, is not easily shaken. Solid family relationships will carry us onto the other side of uncertainty and chaos.
What is family? A hallmark of a strong family is one where love, joy, peace, patience, kindness, goodness, faithfulness, gentleness, and self-control are predominately present. It is important to say that family does not require blood. It does, however, require a commitment to stand together and look out for the interest of others. That is the best way to be family. Then, suddenly, you find yourself in the midst of it without having to search for it. You then become part of a worldwide network that can stand when everything else is shaking. Having and being family, in many ways, covers the 1st three areas of being grounded--spiritually, relationally, and emotionally.
The fourth "root" is financial grounding. We are in a period of time when anything could happen in the financial and monetary world. It seems the world's financial system is on a course to become detached from the reality of natural law and history. We are deep into a worldwide experiment of limitless printing, negative interest rates, and massive market manipulation to generate ends that, in most cases, do not align with the interests of the general population. Gold and silver are the financial groundings if and when the experiment epically fails. They are a cornerstone to any financial house you are building. Both have weathered 5,000 years of storms and have come out the other side more valuable than they went in.
We stand with you during these amazing times. We believe there is something strong being formed that, on the other side, will be a cornerstone for something new. Praying you have peace during this season and that we all end 2020 more grounded than when we entered.
Blessings, be one with the family, be like family to your friends, and be a friend to strangers.
Jeremy Brakenhoff, CEO
Gold & Silver Markets
As the world seeks some form of direction, the gold and silver markets have taken a pause. Healthy consolidation continues, although for many, "consolidation" can seem like a four-letter word. However, examining the most recent bull-market that ended in 2011, it might just bring you some comfort.
What Do the Charts Say?
The first chart is of the last three years of the previous gold bull-market. What we want to draw your attention to is the blue line, which represents the 200-day moving average. This average has been used for decades in chart analysis. It tells the tale of the ebb and flow of market psychology of a secular (long-term) bull-market. The 200-day moving average consistently acts as a magnet for the price of any commodity or security. When the price moves too quickly, it draws the price back to it, just as it did five times in the chart shown.
Now, we turn our attention to the most recent chart. It shows the price as of close on November 30th. Once again, as the price moved quickly to $2,200 and became overbought, 200 DMA brought it back to earth. To be sure, it is at a critical point right now based on the first two blue lines. The price sits at the breakout price in the $1,780 range. Should the price continue to fall, we can expect support at the bottom line in the $1,690 range.
The silver chart is, well, wild to say the least. We can, however, see that it too is at a significant price support level that is in the $22.50 range. Like gold, if it fails to hold this price, there is a well-defined support line in the $19 price range.
Summary
If you believe that this secular bull-market has several years to run, which with all of the financial and geopolitical uncertainty seems likely, technical analysts see this set up in both gold and silver as a great place to add to your position, or certainly to open a new position in the metals.
We provide these charts and commentary for your information only. It is not a recommendation of when or what to buy. We simply want you to be informed during this very volatile time in the global precious metals markets.
Enjoy the holidays with your family, and come January, we will see what the markets are telling us about what we might expect in 2021!