By: David Chapman, Union Securities - 19 May, 2006
The sharp drop seen in the market over the past week or so doesn’t seem to have phased investors much. Since the drop has gotten underway we have actually seen the Markets advisors bullish sentiment www.investorsintelligence.com rise not fall, as one would expect. Grant you the reading was 46.3%, which is just above the normal reading of 45%. But we are still down from the recent peak of 53.2%. These were not near real highs that we have seen in the past of nearly 60% but still they were good readings. Full Story
By: Adam Hamilton, Zeal Intelligence LLC - 19 May, 2006
This past week has been rather traumatic for gold investors. Just two days after achieving dazzling quarter-century nominal highs above $720, gold had fallen 5%. Retreating prices irritate investors to no end, so there is now an increasingly vitriolic war of words underway in the contrarian community about whether we are now witnessing the early days of a full-blown correction, merely a minor pullback, or an irrelevant blip. Full Story
Stochastics trending lower at midrange will tend to reinforce a move lower especially if support levels are taken out. The market's close below the 9-day moving average is an indication the short-term trend remains negative. The market tilt is slightly negative with the close under the pivot. The next downside target is 669.5. The next area of resistance is around 688.3 and 699.0, while 1st support hits today at 673.5 and below there at 669.5. Full Story
Gold fell near $680 in Asia before it rebounded throughout trade in London to over $690 by midmorning New York trade, but it then fell off into the close and ended near its lows with a 1.66% loss. Silver traded mostly slightly lower in Asia and London and started off in New York near unchanged, but it then fell off throughout the rest of trade in New York and ended near its lows with a 5.21% loss. Full Story
In short, a continued stock market sell off could quickly change the Fed’s focus from inflation fighter to asset deflation fighter. Admittedly, the situation is blurry, and it is worth remembering that a rhetorical policy change to try and save the stock market (i.e. a little inflation is wonderful news!) may not be well received by the bond market. Too bad the other asset class on the Fed’s radar, housing, is already scared to death of rising interest rates. The housing market or stock market Mr. Bernanke. You may only be able to and save one... Full Story
For three weeks or so now we have been in peaceful repose with the majority of our investible funds in the GLD ETF. We await the return of the Gold/Silver Ratio to reverse and favor silver, and perhaps even the underlying precious metals mining stocks. We still hold four or five junior producers or explorers, but no majors or mid-tier miners. I suppose we could have gone to cash, but in this world of sudden disruptions and political jealousies we'll stick with our gold, thank you. The fundamentals of world crises and shortages haven't changed. Full Story
I could just about puke every time I get a promotional teaser in the mail from some guru bragging about his last Big Score. The put-and-call svengalis are the worst of the bunch -- and I would know, having traded options myself for more than 30 years, twelve of them on the floor of a the Pacific Exchange. I always double-check the hype, and here is what I have determined: There is not a single option guru in America – at least none of the dozens of whom I am aware -- who even comes close to living up to his promotional claims. You snake-oil peddlers know who you are – and by all means, please do correct me if I’ve got it wrong. Full Story
Momentum studies trending lower at mid-range should accelerate a move lower if support levels are taken out. The close below the 9-day moving average is a negative short-term indicator for trend. The daily closing price reversal down puts the market on the defensive. With the close higher than the pivot swing number, the market is in a slightly bullish posture. The next downside objective is 669.4. The next area of resistance is around 704.9 and 721.8, while 1st support hits today at 678.7 and below there at 669.4. Full Story
Gold rose above $700 in Asia and spent most of trade in London in the $710-$715 range, but it then fell off throughout morning trade in New York and dropped to as low as $685.30 before it rebounded into the close and ended just slightly higher on the day. Silver climbed to over $14 in London before it dropped to under $13 in New York. It also rebounded into the close and ended off its lows, but it still fell 2.5% on the day. Full Story
Anyone who cannot detect rumblings with more magnitude than early volcanic tremors is brain dead, plain and simple. For a full year, the USDollar enjoyed a sizeable counter-trend bounce. It relieved the long-term oversold condition. In usual times, in typical markets, such a period of time would offer the fundamentals an opportunity to catch up, for the remedy to work its medicine, for the condition to heal itself. In the case of the USDollar, the trade deficit worsened. Full Story
The gold bulls were running for the ninth consecutive week as the battered bears retreated to their dens. Gold blew past $700 - briefly touching $732, a new 26 year high point. The yellow metal closed at $710 recording a weekly gain of about $35. Meanwhile Silver climbed above $15 earlier in the week but settled in at $14.21 an increase of about $.30. The new silver ETF reported another increase in its silver holdings. Sources indicate that approximately 10 million more silver ounces have been accumulated, increasing the total to more than 50 million ounces. Full Story
The talk right now is about Gold pushing through the $700 line. Consider that it took Gold rising to $850 before Paul Volcker was able to break the back of inflation in the early 80’s. Now we're at $700 and nobody even acknowledges that there is inflation! Therefore Gold is going to go a LOT higher before the dust settles. In fact adjusted for inflation Gold will have to exceed $2,000 just to match its peak of $850 in 80’s! Full Story
Stochastics turning bearish at overbought levels will tend to support lower prices if support levels are broken. The close below the 9-day moving average is a negative short-term indicator for trend. The close over the pivot swing is a somewhat positive setup. The next downside objective is now at 679.9. The next area of resistance is around 698.3 and 701.4, while 1st support hits today at 687.5 and below there at 679.9. Full Story
Gold fell near $675 in after hours trade late yesterday, rebounded to above $685 in mid-Asian trade, and fell back under $675 near the open in London, but it then rallied throughout trade in London and New York and ended near its highs of the session with a 1.2% gain. Silver followed a similar rollercoaster ride and gained 1.95%. Full Story
By: Julian D. W. Phillips, Gold Forecaster - 16 May, 2006
The president called for the establishment of a Rouble-denominated oil and natural gas stock exchange in Russia. "The Rouble must become a more widespread means of international transactions. To this end, we need to open a stock exchange in Russia to trade in oil, gas, and other goods to be paid for in Roubles," he said. Putin said this would be impossible without economic growth of over 7%, which, he said had been achieved in the past three years. Full Story
By: Steven Saville, Speculative Investor - 16 May, 2006
There's a widely held opinion that you can take advantage of a weakening US$ by buying your resource shares outside the US; in Canada, for instance. We'll put aside, for a moment, our view that the US$ is more likely to rise than to fall over the coming 6-12 months and look at why this widely held opinion is logically flawed. Full Story
After today's dramatic plunge, a partial recovery is considered likely that should last at least a day and possibly several days. Such a rally should be used by traders to lighten positions and/or load up with put options in weaker large golds such as Newmont, to either take advantage of further retreat, or to insulate existing long positions in the sector from major losses. We will be highlighting the most effective put options in large golds on the site in coming days. Full Story
The jury has returned its verdict - "Silver has double-topped with its April highs". So silver bulls can forget about any new highs for a while. Although silver has powerful bullish forces underpinning it, the same factors that are set to precipitate an intermediate reaction in gold, principally a rally in the dollar, are expected to have a similar effect on silver, although due to the strength of the bullish forces at work in silver, it is considered more likely that a trading range will develop, lasting perhaps several months. Full Story
Much new money has been attracted to the resource sectors of metals and energy lately, therefore, it is only appropriate that a substantial correction has now begun. After all, those who are now taking profits must find new buyers, the same old “buy low and sell high” in the market place. Full Story
Via the bulletin launcher, I disseminated a very precise correction target yesterday for June Gold as well as a recommendation to buy bullion futures (or an equivalent) aggressively if and when the target is reached. If this hidden-pivot support works as anticipated, and the futures trampoline from it, the correction will have amounted to about nine percent from recent highs. That’s a pretty steep move, occurring as it will have over the course of just two or three days, but it would hardly be extraordinary. Full Story
Momentum studies trending lower from overbought levels is a bearish indicator and would tend to reinforce lower price action. A negative signal for trend short-term was given on a close under the 9-bar moving average. The gap lower price action on the day session chart is a bearish indicator for trend. There could be some early pressure today given the market's negative setup with the close below the 2nd swing support. The next downside target is 666.3. The next area of resistance is around 695.5 and 708.2, while 1st support hits today at 674.5 and below there at 666.3. Full Story
Gold rose near $720 in Asia, plummeted near $685 at the close of trade in Asia and open of trade in London, and traded in a range between $685 and $700 for the rest of trade in London and for most of morning trade in New York, but it then fell under $680 in afternoon New York trade before a small rally into the close took it off its lows of the session. Silver followed a similar pattern and lost 6.26% to top gold’s 3.79% loss. Full Story
By: Julian D. W. Phillips, Gold Forecaster - 15 May, 2006
At one extreme, there are the “Gold Bugs”, supposedly constant ‘bulls’ of the gold price, so not too reliable? At the other end there are those who look at the gold price as “peaking”, simply because it has gone up a lot, so it has to come down. And with so many one way or the other, the market is labeled as dangerous or worse. But there is a tendency amongst professionals as well as amateurs, to believe that if it is not measurable, of numerically definable, it is dangerous, speculative or just plain gambling. In this gold market, such views will exact a heavy penalty from those who hold them! Full Story
On May 12 we send out an HUI alert to our members suggesting that due to the Gold/HUI divergence a major HUI upswing couldn’t be ruled out. Well, exactly the opposite happened and the HUI sank like a stone dropping 18 pts…Does it change my HUI outlook? No, not really, it only strengthens the thesis that the Gold/HUI imbalance has reached an extreme that has to be resolved rather sooner than later..Such an imbalance can only be resolved by a major HUI up-swing or a fast dropping gold price. Full Story
A bearish signal was triggered on a crossover down in the daily stochastics. Stochastics turning bearish at overbought levels will tend to support lower prices if support levels are broken. The market's short-term trend is positive on the close above the 9-day moving average. The market setup is somewhat negative with the close under the 1st swing support. Full Story
Gold fell over $5 in after hours trade yesterday, recovered a bit in Asia, and rose near $730 in London, but it then fell throughout trade in New York and ended near its lows of the session to close with a 1.33% loss and fall from 25 year highs. Silver followed a very similar pattern and ended nearly 5% lower to fall from its 25 year high set on Thursday. Full Story
I am being inundated from all quarters of the globe with analyses on how high the gold price can go from commentators that were conspicuous by their silence before gold hit $600. This concerns me as when the euphoria really grabs hold it is time to take profit action. For the past two years I have detailed that distrust of the dollar as an investment currency, the growth in Indian jewelry off take, China’s massive middle class explosion for gold investment coupled with the potential for Chinese reserves to dramatically increase, as well as global political instability would be the driving forces for gold’s move. Not inflation. Suddenly I find that all these new boys on the block have belatedly discovered these arguments. Full Story
So, what came together was excessive enthusiasm for U.S. stocks, a collapse of confidence in the U.S. dollar, money fleeing banks into Gold, forced global selling of stocks to meet margin calls and in general a swirling pit of financial emotions. By Thursday morning, the emotional finance juices were spent. CNBC cheerleaders could drum up no more buyer support for markets. Full Story
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