After a remarkable day of trading in the gold and silver markets, today the man who made one of the greatest market calls in history told King World News that the wild trading action in gold and silver has stunned market participants, and a historic buy signal has just taken place. Below is the incredible interview from Ben Davies.
Davies: “Eric, I was interviewed on CNBC yesterday with Chris Powell. We were talking about surreptitious behavior in the gold and silver markets, particularly last Friday and early Monday. We were on for about 15 minutes but unfortunately there wasn’t a long clip. So I wanted to tell the King World News readers globally my viewpoint in light of the incredibly volatile action we have just witnessed and the quite deliberate call I made in last week’s KWN interview. The wild trading action in gold and silver has stunned market participants and caught the shorts completely off guard…
Continue reading the Ben Davies interview below…
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“But we strongly believe as a firm that the gold market has bottomed. Silver has finally given me the egregious bullish divergence that I was looking for. We saw a 6 percent downdraft in a totally illiquid market in early Asian trading on Monday — just asinine price movement.
But at 7 AM in the morning in yesterday’s CNBC interview, with gold still down $10 and silver still trading negative, I said this was going to reverse and close up near the highs. And that’s great. I live for these markets. That’s given me all the signal information I need. I believe that the long-term buying zone for silver is $13.50 – $15. We hit $14.10 and reversed back up to $16.50, and so I’m only looking to be long here. And you don’t want to be too cute about it because investors really need to be accumulating physical silver here.
The same thing applies to gold. Gold couldn’t even break to new lows below $1,130 in the early Asian takedown as it stubbornly held its ground, despite the relentless pressure in the paper market. Gold headed down to $1,142 and it then reversed back to $1,200. Clearly there were some shenanigans in the gold market surrounding the Swiss Gold Initiative.
This has led to lease rates being negative and gold flying out the door as the West continues to hemorrhage its gold to the East. The leveraged shorts bullying in the market is not working anymore. So we’ve got some serious divergences here.
Oil and copper still need to unwind some of their excess leverage. I think oil could bounce here but I think it was a game-changer for OPEC in Vienna. The Saudis have stepped back and they are now going to let the market decide where it’s going to go.
But we’ve come down a long way in price and so I think there’s a sea change happening here in these key markets. Tectonic plates are now colliding. What that means is all this price action in commodities and metals, this isn’t healthy behavior. This is the behavior of markets at an inflection point and in a regime shift.
So what we are about to see now is the leverage come out of the equity markets, particularly in the United States. I don’t remember seeing a downdraft in December in the U.S. stock market in the last 15 – 20 years. But I will be so bold as to say that I think we are going to see a downdraft back to the October lows over the next few weeks. As I said, it’s time to sell out of U.S. stocks and buy into precious metals.”
Davies added: “If you recall, Eric, the Euro/Swiss peg came at the high in the gold market at $1,900 in September of 2011. Ironically the gold market should have exploded higher on that news, but that signified the top. Now, perversely, we have just witnessed another ‘No’ vote on gold in Switzerland. So the Euro/Swiss peg remains for now, and for the second time the Swiss National Bank’s arrogance has flashed a major trend change signal, but this time it is signaling the bottom in the gold market instead of the top.”
IMPORTANT – KWN has many more interviews being released today.
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The audio interviews with Rick Rule, Bill Fleckenstein, Ben Davies, Greyerz-Turk-Stamm, Gerald Celente, David Stockman, William Kaye, Dr. Paul Craig Roberts, Andrew Maguire, Eric Sprott, Rick Santelli, Michael Pento, John Mauldin and Marc Faber are available now. Other recent KWN interviews include Jim Grant and Felix Zulauf — to listen CLICK HERE.
