Forget all the noise about a market correction for gold an silver.

February 02, 2011 – Forget all the noise about a market correction for gold an silver. Because of last year’s stunning performance a market retest was in order and both metals held up strongly, with prices bottoming out well above the baseline support points. Big investors are once again getting back in (SPDR just snagged over three metric tons of gold), ready to ride the bull for another year.

Meanwhile, Wall Street traders are desperately trying to find some suckers so they can cash in their increasingly perilous wares. They see a dark road ahead but they aren’t talking openly about it. Thankfully, somebody else is.

In Resource Investor, chartered market technician (CMT) Jordan Roy-Byrne explains that the current stock market has all of the signs of a secular bear market, a well established pattern that was repeated three times in the past century. One of the most prominent defining features of a secular bear market is a midpoint crash followed by a significant rally, exactly what stocks experienced beginning in 2008. That rally will peak in Q2 of this year, Roy-Byrne says, and will be followed by a prolonged cyclical bear market.

As our government continues to pretty up the deteriorating economy with its only recourse of further monetization, it is likely that stocks and bonds will both be bear markets “for the first time since the late 1970s” and it “could begin as early as Q2 of this year.”

By 2012 at the latest hard assets will go mainstream, and that will eventually give birth to a bubble. But that is years away because precious metals are vastly under-held. For the time being, we can expect a long pre-bubble upsurge much like that in the technology sector beginning in 1994.

The market retest is over. Now is the time to buy gold and silver to maximize returns from the wild ride ahead.

Shannon King

Senior Staff Writer –

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