Precious metals started the day by plunging rapidly, and our current speculative short position appears justified.

However, please note that two of our indicators flashed a signalbased on Friday's closing prices. The question is what does it mean for precious metals prices and for you.

The signal from the SP Extreme indicator suggests that a rally in gold stocks will start in 4 days and the SP Extreme #2 indicator suggests that the rally in mining stocks will start tomorrow, but that it won't really pick up until the 4th day after the signal was flashed (meaning the coming Thursday). We will provide charts supporting the above in this week's Premium Update.

We believe that in this case (metals are declining today which invalidates the theory of an immediate rally), two signals (from the SP Extreme and SP Extreme #2 indicators) simply means that one should prepare for closing the short position no later than on Thursday. We will send a final confirmation and this alert is just to give you heads up.

Mining stocks are holding up relatively well so far, it seems that the coming bottom will be a great moment to add to one's mining stock holdings.

On a side note, we have almost completed preparing charts featuring the most probable price paths of gold, silver, and the HUI Index after each of our indicators flashes a signal. We will also start working on the most probable price paths after a combination of signals is seen (just like what we have right now) so that you know what do expect even without our additional commentary.

As a reminder, these are our targets for the current decline:

- Gold - $1,680 - $1,700
- Silver - $30 - $31
- GDX ETF - $48
- HUI Index - 450 - 460.

Please note that we do not suggest getting out of your long-term precious metals investments at this time.

As always, we'll keep you updated should our views on the market change - even if it means sending another message in several minutes.

Thank you.

Sincerely,
Przemyslaw Radomski, CFA