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Patrick MontesDeOca
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Published Technical Analyst, Author, Commodity Trader, Systems Developer, Algorithmic Intelligence, Computer Modeling of Processes. I custom build Proprietary Artificial Intelligence for each individual client's portfolio needs. After more 30 years in the business, Patrick MontesDeOca has... More
My company:
Equity Management Academy
My blog:
Trading Talk
My book:
Vedic Codes of the Stock Market Volume 3 – ETFS
  • Silver's Next Big Move - An Exclusive Interview With Patrick MontesDeOca 0 comments
    Jun 10, 2012 11:58 AM

    This is Jim McCraigh from Today my guest is Patrick MontesDeOca.

    PM: Thanks Jim for having me on the show with you. It is a pleasure.

    JM: Patrick, silver seems to be lagging gold a little bit here we have some interesting action today when silver just started getting up in the high twenty nine dollar range But how do you explain that what you think is happening with silver right now?

    PM: I think one of the major elements affecting prices of the silvermarket in particular is the overwhelming bearish sentiment that is in the market right now. If you take a look for example at what's happened to the mining shares metals, stocks, and ETF's, they have gotten a little bit clobbered over the last few months. It has been a psychological war to intimidate people from moving into precious metals more than anything else. Creating the kind of fear that ordinarily puts in a capitulation from individual traders as apposed to the sentiment of the market. I think this situation certainly has occurred in the prices of silver. I would say silver has come down to a level where there is some economic balance in price. Solid physical buying is just under $27 dollars. We are beginning to see the bids moving higher, which means that we're getting new buyers into the market. Because what they're trying to do is eliminate speculators out of the market, with fear of raising margin requirements and manipulation of the futures markets and so on… It takes a little longer for silver to move, but watch out when it does.

    JM: So that said the global economy seems to have its share of struggles right now. Do you think that the potential lack of industrial demand for silver is holding it back here also?

    PM: I think that the metals are holding exceptionally well under the face of this deflationary environment that we've been in obviously for the last 6 months on a very profound basis. So once again I think that what we're looking at in fact is the other side of the coin. That is the sentiment of the market has gotten to such an extreme, that potentially a bottom has been completed as we speak. In fact, we published our first report on the 23rd of May calling for bottoms in precious metals, stock indices, currencies and commodities. It was a strong opinion but our market intelligence gave us the criteria that we were looking for. Revealing that all of the fundamentals have already been discounted in the price of precious metals, stocks, commodities and in fact what we are seeing is that these prices have already discounted a much worse case scenario than we're looking at.

    JM: How do you see central banks influencing precious metals now, Patrick?

    PM: I think it is a short term situation as long as I have been around, I have seen central banks intervene and try to move in to protect the dollar by doing swaps at convenient ranges. That goes on all the time. But the real problem is that I think the banks are in a deeper problem than they would like to admit. I am not so sure that we know the extent of the tremendous amount of toxic assets that they are carrying, in what I believe is a world bond market bubble. There are exceptions obviously. Germany and some of these peripheral countries like Poland and Turkey. Some of them are showing resilience in the face of the euro-zone crisis. But the problem is we really do not know the extent of the losses. We're beginning to see a little bit of it trickling in like JP Morgan. I think that it is just the beginning of a much deeper problem that is coming out bit by bit, and that is going to surprise the financial community in a big way.

    JM: You talk about energy in precious metals markets. Can you elaborate on that?

    PM: What I mean by energy is that we take a look at the cyclical patterns of the financial markets very much like Elliott Wave. In fact we use Elliot Wave, WD Gann and Fibonacci applications to measure cycle wave patterns which in essence are measuring the energy of the market in anticipation of certain peaks and bottoms. One of the things that we found through our research, and we've done a lot of research on this, is that in using western technical analysis and western mathematics along with the application of Elliott Wave or WD Gann. There are deficiencies when using these formulas individually. For example the deficiency in using Elliot Wave is that they do not know the beginning wave or the beginning count. From the research that we have done, what we have discovered is that in order for a pattern of energy to be completed it has to have a beginning, middle and an end. If you do not know the beginning count or wave you're just guessing where the shorter term wave counts are. They're not really in sync with the bigger wave counts, not to mention the calendar that is used. What we found is a tremendous application in using Vedic mathematics. What we discovered after much research is that it is essentially the basis of all western mathematics. The Hindu Arabic numerical system of 1 to 9. They created the zero base system which changed the complexity of modern mathematics exponentially. What Fibonacci, Elliot Wave and WD Gann had in common was that they were influenced by this conciseness or thinking mathematically that was so advanced that when they brought it to western society it became the basis of modern geometry and math.

    JM: So how do you take all this information and put it in a usable form? For somebody that does not want to take the time to do that. How does that work?

    PM; In terms of the application, I look at it in a way that I can benefit myself as a trader. So in terms of a trader I look for a very simple way to provide me with the information that I call intelligence. What we have done is to write a proprietary algorithm using this formula for the application in the financial markets and in particular the precious metals.

    JM: Patrick if people want to learn more about this your website is:

    PM" They can go to or you can go to the

    JM: Well thank you so much Patrick for today. I appreciate your comments and it is always good to hear from you.

    PM: I appreciate the time and thank you for thinking out of the box.

    Disclosure: I am long PSLV, AG, AGQ, GDX, PHYS.


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