Metals and miners at another huge decision point.

Elliot Waves have points of inflection built into them that serve as a sort of groundhog day for the underlying asset.  We are at one of those inflection points right now in metals.  The herd has popped its head up after the recent little pop in metals followed by the expected partial retracement and is trying to determine the lowest energy path to take next.  The next small move in metal prices will likely set the tone for a larger move.  That move will likely either confirm that a significant bottom is likely in place or tell us that another wave down is coming.

In this last post, I modeled today's sell off in metals perfectly.  The below, left chart was from that post.  The right hand chart was today's big gap down.  It closed at a level just even with the prior 4th (OR the B wave - still not sure which it is).  Since both the red and blue models were expected to make this same pullback, we probably won't know tomorrow either.  Why?  Because we likely need some kind of upward retracement from this big gap down.  So, perhaps back up to $19.20 or so. It's likely that only then that we will start to know for sure.  Does it a-b-c back up there and the come crashing down in a big 3rd wave or does it keep going up to a higher high (again with gaps.).  So no matter what happens, I expect volatility either to the upside or to the downside.

I say let it plummet.  I would just laugh.  You know, when stocks plummet you have to really worry because the companies behind stocks go BK all the time.  But when metals get oversold and you continue to buy them without the use of debt or margin or any other kind of leverage then what you are really doing is locking in future profits because unlike paper assets, metals will not, cannot go bankrupt.  Just like solar earlier this year, metals are being way oversold.  It means that nice profits await the patient folks.

Even timber companies don't have it as safe as investors in physical gold and silver.  It's always said that when prices go too low, timber companies can just reduce their cutting and let the sun and the rain literally grown their future profits.  But even in that scenario you can lose the crop to wildfires, disease, etc.  Not so with gold and silver.  It just sits in the safe all shiny and heavy and substantial.  This is the age old, tried and true way t end up with a lot of money for your retirement.   So manipulate those metals prices down, boys.  Run them into the ground.  Try to discourage the people of India.  Try to scare away the Chinese.  And good luck trying to scare me away either.  The lower the better because all you are doing is coiling up a massive spring that is going to come unglued at some point and probably far overshoot the real value of the metals.