
Echoes Of The Andromeda Strain Paradox

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So here we are, with the sector leading the recovery out of the March crash during still-deflationary times. Inflation? It is not yet anywhere to be found, and that probably has a lot of inflation-centric would-be gold boosters on the sidelines. Someday, when these ladies are in full cheer with inflation signals rising, it will be time for caution.
One of the principal reasons for the strength in the small caps yesterday and today is that banks have been recovering. Here are three SlopeCharts that speak to that strength, with particular emphasis on the price gaps. Please click on any given chart for a better view and to clearly read the value of the price gap. Here’s the Broker/Dealer Index:
To be clear, I offer the chart utterly objectively, and I have no precious metals position of any kind. With all the excited chatter about silver, I simply want to point out it is dangerously close to an important price gap. This might be a place to consider taking profits.