TheMidasTouchConsultingReport1stofFebruary2016©FlorianGrummes2015 1

TheMidasTouchConsultingReport1stofFebruary20161. MarketUpdate

It´sbeenanastystartintothenewyear.Deflation(drivenbyaweakChina)keeps on eating into the systemand now is visible for everybody.I havebeenwritingaboutthismanytimesduringthelastcoupleofyears.Yettheglobal puzzle has become so complex that it is basically impossible tocorrectly interpret and evaluatewhat´s really goingon. I thereforepreferthe sober lock at the charts, even if this means to neglect thethreedimensional strategic thinking. My currentconclusionisthefollowing:Stocks are in abear-marketandshouldbe avoided. The mantra now is"sellthe strength to either reduce your open risk orto short thegeneralstock-market".Commodities in general should remain depressed yet an agressivebear-marketrallyshouldbeexpectedsoon.Oilhasseenanimpressivereversal,hasprobablyfoundit´sbottomfornowandisonthewaybackto$40.Gold continues to run into a falling bullishwedgewhich stillmeans verylikely$1.000beforeanewbullwillstart.South-African Miners are the "mining play" of the year as gold inSouthAfrican Rand has not yet hit its technical target. Wait for a largersetbackintheseminingstocksbeforeyoubuy.Bitcoin is consolidating within an ascending triangle and should beaccumulatedonanyweaknessbelow$380.

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2. Bitcoinwithinamulti-monthbullishtriangleconsolidation

Bitcoincontinuestorunintoanascendingbullishtriangle.Expectthistypeofbullishconsolidation to last fora coupleofmonths.CurrentlyBitcoin isoversoldandaclearbuy.Withinthistrianglethebullishpressureisslowlybutsurelybuilding.Actiontotake:BuyBitcoinrightnowandrighthereEntryPrice:below$380,currently$370StoppLoss:$290(22.6%)ProfitTarget:$800Timeframe6-18monthsRisk($80) / Reward($430) = 1 : 5.4 (very good ratio!!)Position Sizing:Don´triskmorethan1%ofyourequity.

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3. TheMidasTouchGoldModelonaBuySignalsinceJanuary26th

ThemodelturnedbullishagainonJanuary26th.Therecentchangesincludebuysignalsfrom:GoldUSD-WeeklyChartGoldVolatilityCBOEIndexSPDRGoldTrustHoldingsGoldin4majorcurrenciesGDXGoldminers-DailyChartNewSellSignalsarecomingfrom:GoldSeasonalityGDXGoldmineSentimentUS-Dollar-DailyChartOverall it isnotastrongbull signal so farbut since theminers (GDX)arejoingthepartywehaveabullsignalagain.Anydipbelow$1.098willverylikelyshiftthemodelsresultimmediately.

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4. Goldrunningintoafallingwedgeonthemonthlychart

Long-termthisisbullish,short-termGoldishittingmassiveresistance.

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5. Goldwithagoodstartintothenewyearbutalreadyoverbought

Gold had a good start into the new year. Afterinitially failing at theresistance around $1,110 it finally broke through this numberlastTuesdayand quickly pushed towardsthe 200MA. Since mid of lastweekwesawasmallconsolidationincludingatestofthebreakoutlevelat$1.110.Todaybulls are already comingback into themarket and it lookslikegoldcouldrununtiltheupperresistanceofthewedgearound$1,135-$1,140beforethismoveisover.Overall I remain skeptical towards the recovery since December. Thismoveis not looking very impulsive and sentiment is already extremelyoptimistictoacertainextent.E.g.theweeklyKitcoGoldSurveyhaspostedtwoweeks ina rowresultswithgoldbulls>80%.Thisis a clearwarningsignalandgoesa longwiththeunhealthysentimentnumbersfortheGDX(see my model). Besides that seasonality is now fading towards thenegativecycleuntilmidofJune.At leasttheCoTnumbersforgoldarestillconstructive.Thereforemy preferred scenario sees gold failing at $1,135 - $1,140 andstartingamulti-monthdownlegwithahighprobabilitytohitthefinallowaround$980-$1,025untilJune.Butadailyorbetteraweeklycloseabove$1.140immediatelywillchangethepictureandactivate$1,190asthenexttarget.

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Actiontotake:Swing traders should patiently wait at the sidelines. There are no goodsetupscurrently in thegold-market. You don't want to buy into anoverboughtmarket.Investors should continue to buy with both hands if Gold moves below$1,050againuntilyouhaveatleast10%ofyournet-worthinphysicalGoldandSilver.6. Portfolio&Watchlist

Portfolio: BuyBitcoinbelow$380withastopat$290.Plantohold

foracoupleofmonths.Watchlist: MarketVectorsGoldMiners(GDX)

MarketVectorJuniorGoldMiners(GDXJ)DRDGold(DRD)EndeavourSilverCorp.(EDR.TO)McEwenMining(MUX.TO)MagSilverCorp.(MAG.TO)UnitedStatesOilFund(USO)AgricultureETF(DBA)

Track-Record: WegotstoppedoutofourgoldshortpositiononJanuary4th at $1,083 for an outstanding gain of $97/contractor8.2%(=8.08R).

7. Long-termpersonalbelieves(mybias)

Goldisinabearmarketandheadedtowards$1,035-$980.Oncethisbearis over a new bull-market should start and push Gold towards $1,500within2-3years.My long-term price target for the DowJones/Gold-Ratio remainsaround1:1.and 10:1 for the Gold/Silver-Ratio. A possible long-termpricetarget for Goldremains around US$5,000toUS$8,900 per ouncewithin the next 5-8 years (depending on how much money will beprinted..).Fundamentally, as soon as the currentbear market is over,Gold shouldstartthefinal3rdphaseofthislong-termsecularbullmarket.1ststagesawtheminersclosingtheirhedgebooks,the2ndstagecontinuouslypresentedus news about institutions and central banks buying or repatriating gold.The coming 3rd and finally parabolic stagewill end in the distribution to

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small inexperiencednew traders& investorswhowill be subject to blindgreedandfrenziedpanic.Bitcoincouldbecomethe"newmoney"forthedigital21stcentury.Itisfreemarket money but surely politicians and central bankers will thrive toregulateitsoon.If you like to get regular updates on this model and gold you cansubscribetomyfreenewsletterhere:http://bit.ly/1EUdt2K©FlorianGrummes2015allrightsreservedHohenzollerstrasse36,80802Munich,GermanyDisclaimer&LimitationofLiabilityTheaboverepresentstheopinionandanalysisofMrFlorianGrummes,basedondataavailableto him, at the time of writing. Mr. Grummes's opinions are his own and are not arecommendationor anoffer tobuyor sell securities.Mr.Grummes is an independent analystwho receives no compensation of any kind from any groups, individuals or corporationsmentioned in theMidasTouch.As tradingand investing inany financialmarketsmay involveserious risk of loss, Mr. Grummes recommends that you consult with a qualified investmentadvisor,onelicensedbyappropriateregulatoryagenciesinyourlegal jurisdictionanddoyourown due diligence and research when making any kind of a transaction with financialramifications.Although a qualified and experienced stockmarket analyst, FlorianGrummes isnot a Registered Securities Advisor. Therefore Mr. Grummes's opinions on the market andstockscanonlybeconstruedasasolicitationtobuyandsellsecuritieswhentheyaresubjecttothepriorapprovalandendorsementofaRegisteredSecuritiesAdvisoroperatinginaccordancewiththeappropriateregulationsinyourareaofjurisdiction.Thepassingonandreproductionofthisreportisonlylegalwithawrittenpermissionoftheauthor.Thisreportisfreeofcharge.Youcansignuphere:http://eepurl.com/pOKDbHinweisgemäߧ34WpHG(Deutschland):MitarbeiterundRedakteuredesMidasTouchGoldNewsletterhaltenfolgendeindieserAusgabebesprochenenWertpapiere:physischesGoldundSilber,BitcoinssowieGold-Terminkontrakte.Imprint&LegalDisclosureAnbieterkennzeichnunggemäߧ6Teledienstgesetz(TDG)/Impressumbzw.Informationengem§5ECG,§14UGB,§24MediengesetzHerausgeberundverantwortlichimSinnedesPresserechts/inhaltlichVerantwortlichergemäߧ6MDStVFlorianGrummesHohenzollernstrasse3680801MünchenGermanyE-Mail:info@goldnewsletter.deWebsite:www.goldnewsletter.de