By: Adam Hamilton, Zeal Intelligence LLC - 7 April, 2006
With gold challenging $600 this week and the HUI achieving new all-time highs, gold stocks are on a lot of investors’ minds. I have certainly been pondering them too while enjoying their latest dazzling upleg. A few weeks ago I wrote an essay on commodities bull portfolio design, how both investors and speculators can build custom stock portfolios that minimize their risks while maximizing their chance to reap enormous profits over the course of this commodities bull. Full Story
By: Steven Saville, Speculative Investor - 7 April, 2006
The US stock market appears, on the surface, to have been quite firm over the past several months, but in real terms (that is, relative to gold) the market has been very weak. In fact, the following chart shows that the S&P500/gold ratio broke downward from a lengthy sideways consolidation during the final quarter of last year and is presently testing its February-2003 bottom. Full Story
The market rallied to a new contract high. Rising stochastics at overbought levels warrant some caution for bulls. The market's close above the 9-day moving average suggests the short-term trend remains positive. The gap upmove on the day session chart is a bullish indicator for trend. Since the close was above the 2nd swing resistance number, the market's posture is bullish and could see more upside follow-through early in the session. The next upside objective is 602.7. Full Story
Gold traded around a dollar higher in Asia and then rose up near $597 in London before it dropped back to about $592 in New York, but it then rallied into the close and ended near its highs at a new 25 year high. Silver followed a very similar pattern but was able to exceed its highs in London with its closing surge and it ended with a 3.08% gain to a new 22 year high. Gold and silver equities jumped nearly 2% higher at the open and then dropped to find slight losses midday, but they then rallied into the close and ended near their highs of the session. The HUI and GDM set new all-time highs while the XAU remains about 7 points from new all-time highs. Full Story
After hitting a 5-year high yesterday the Nasdaq is up by 110% since its October 7, 2002 bottom. If this blistering pace keeps up the Nasdaq will be back above 5,000 (only another 113% away!) sometime in 2010. However, what comes first, Nasdaq 5,000 or a very deep sleep, it is difficult to say. What can be said is that US stocks are in one of the most boring bull markets ever (call it a cyclical bull inside of a secular bear if you want, but the longevity of this rally means it is a bull nonetheless). And while some would argue that boring is good because it means the markets haven’t peaked, sometimes boring is just boring. Full Story
Silver (and gold) prices have now climbed to levels not seen in 20+ years. Volatility has increased proportionately and appears here to stay. As a result of the price action and expectations for the new silver ETF, more media attention has been focused on silver and other metals than at anytime in recent memory. I can’t prove it, but I believe there has been more spoken and written about silver by the mainstream media in the past few weeks, than the cumulative total for the past five years. Unfortunately, quantity is not the same as quality. Full Story
Momentum studies are trending higher but have entered overbought levels. The close above the 9-day moving average is a positive short-term indicator for trend. The daily closing price reversal up on the daily chart is somewhat positive. The market has a slightly positive tilt with the close over the swing pivot. The next upside objective is 599.0. The market is approaching overbought levels with an RSI over 70. The next area of resistance is around 596.0 and 599.0, while 1st support hits today at 588.9 and below there at 584.6. Full Story
Gold traded about $1-$4 lower in Asia and London before it jumped up near $590 at the New York open. Gold fell back near $583 midday, but it then rallied into the close and ended slightly higher. Silver followed a similar rollercoaster ride and ended unchanged on the day. Gold and silver equities jumped about 1% higher at the open and then quickly fell back near unchanged on the day, but they then steadily rose throughout the rest of trade and ended near their highs with about 2% gains. Full Story
NEM has been lagging badly during the recent correction and subsequent recovery, and has partly contributed to the under performance of the $HUI and $XAU, which should be corrected once the current technical structure has the time to resolve itself. Of course, from current indications, the resolution should be bullish, and the risk/reward is very favorable for both traders and investors, to either establish or adding to positions. Full Story
The good news, for reasons aired here yesterday, is that gold looks like it’s staging to blow past $600 and run up to at least $625 over the near term. The bad news is that it could pull crude oil quotes along with it. I proffer the chart below as evidence that this scenario may be about to occur. Although most technicians would regard Monday’s high at 67.90 as a double top of sorts, the fact that it exceeded early February’s peak at 67.89 by a single penny has bullish implications from a hidden-pivot perspective. Full Story
Giant geopolitical factors have been dominant toward the gold price in the last half of 2005 and the early part of 2006, having eclipsed trade deficits, absent savings, price inflation, and other plebeian economic fundamentals like consumer demand, job growth, or industrial output. Bond yield differentials continue to be important, but lately, writing on the wall clearly paints a picture of US interest rate advantage slowly fading from springtime rains. Gold seems poised for a meteoric rise. Full Story
It may sound weird to some, but I believe the U.S. stock market would be far more likely to suffer a sharp fall if it would actually go to a new, all-time high (basis the DJIA) then if it started falling right now. Hard to imagine, but in the carnival-like atmosphere that the “Don’t Worry, Be Happy” crowd will surely create on a new, all-time high in the DJIA, there would be a series of negative technical divergences and non-confirmations, all of which I believe would be the straw that breaks the bull-run camel’s back. Full Story
Momentum studies are trending higher but have entered overbought levels. The close above the 9-day moving average is a positive short-term indicator for trend. The market setup is somewhat negative with the close under the 1st swing support. The near-term upside objective is at 597.1. The next area of resistance is around 593.3 and 597.1, while 1st support hits today at 587.8 and below there at 586.0. Full Story
Gold traded a couple dollars lower in Asia and fell near $585 in London before it rebounded to near unchanged by midmorning New York trade, but it then fell back off into the close and ended with a relatively small loss to fall from 25 year highs. Silver traded mostly slightly lower in Asia and London and was able to find minor gains in mid-New York trade, but it also fell off into the close and ended slightly lower to fall from 22 year highs. Full Story
IMHO, the U.S. Dollar has completed its countertrend rally and is resuming its secular bear market trend that began in 2002 when the U.S. Dollar Index was up around 120 (see chart 1). I believe by this time next year (if not sooner), it will be testing critical support around 80. Eventually, that support should give way as economic carnage comes home to roost in the good ole’ USA. Full Story
By: Steven Saville, Speculative Investor - 4 April, 2006
Those who argue that the US cannot avoid a deflationary outcome will often support their case by pointing to the experience of Japan during the 1990s. The Japanese monetary authorities, so the story goes, were unable to prevent the slide into deflation despite their concerted efforts to promote inflation.The first thing we'll note is that Japan didn't actually experience deflation during the 1990s. Full Story
The market rallied to a new contract high. Studies are showing positive momentum but are now in overbought territory, so some caution is warranted. The close above the 9-day moving average is a positive short-term indicator for trend. There could be more upside follow through since the market closed above the 2nd swing resistance. The next upside objective is 600.2. The market is approaching overbought levels with an RSI over 70. The next area of resistance is around 597.4 and 600.2, while 1st support hits today at 591.2 and below there at 587.7. Full Story
Gold initially climbed over $585 in Asia but dropped near unchanged by the open in London which took the price back above $585 by the open in New York. Gold then surged above $590 by late morning trade before it fell off slightly into the close, but it still ended with a 1.34% gain to a new 25 year high. Silver traded about 10 cents higher in Asia and London and then jumped over $11.75 in New York before it also fell off slightly into the close, but it still ended with a 2.18% gain to a new 22 year high. Full Story
Are you excited? Excited about what you ask? Well first of all, we are currently in the midst of a great move in the price of gold and silver bullion with much more to come based on the views of many of the top analysts. And it sure appears the recent ‘correction’ (shallow that it was) is over and it is up, up and away time. Hopefully, investors are onboard and benefiting from these wonderful times. Full Story
By: Julian D. W. Phillips, Gold Forecaster - 3 April, 2006
In the week ending the 24th March 2006 three Central Bank Gold agreement signatories sold approximately 6 tonnes of gold again, a repeat of last week. These relatively small sales underpin our belief that it is the lack of selling volume that is helping to drive the gold price skyward at the moment. It is difficult to state accurately just what the “Official” policies of the Central Bank Gold Agreement are now, because of their lack of transaprency on the day-to-day picture. However, the E.C.B. sales and statements are fascinating [see below] and give us room to speculate a little. Full Story
By: Joe Ferrazzano, Trade The Cycles - 3 April, 2006
NEM, HUI, and the XAU's Wave 4 short term downcycle began early on Thursday 3-30 (see 1 year charts). NEM, HUI, and the XAU hit 2% follow through Wave 5 minor intermediate term cycle buy signals on Tuesday 3-14 (see HUI 1 year chart dated 3-17), which indicates that the major upcycle's (since 5-16-05) Wave 5 minor intermediate term upcycle and a monthly upcycle began on Friday 3-10-06. HUI is probably headed for 400-450+ in Wave 5. Full Story
Rising stochastics at overbought levels warrant some caution for bulls. The close above the 9-day moving average is a positive short-term indicator for trend. The market's close below the pivot swing number is a mildly negative setup. The next upside objective is 589.1. The 9-day RSI over 70 indicates the market is approaching overbought levels. The next area of resistance is around 585.3 and 589.1, while 1st support hits today at 578.3 and below there at 575.2. Full Story
Gold traded a couple dollars higher in yesterday’s after hours Access trade and remained mostly higher in Asia, but it then steadily fell off in London and New York and ended 0.73% lower to fall from 25 year highs. Silver traded about 10 to 15 cents higher in yesterday’s after hours Access trade and climbed up over $11.90 in Asia, but it then also steadily fell off in London and New York and ended 0.43% lower to fall from 22 year highs. Full Story
Gold has rocketed above the $555 resistance and is on course for my three year target of $610 to $625. When it achieves this level I will have to rethink my long term strategy. I will remain very bullish for the upside potential over the next few years but will need to analyse the immediate picture. I have already detailed that there are further potential counts to $685 and $725 but the data will have to confirm them once the $610 is reached. Full Story
M3 died a quiet death this week. As for whether the Fed’s decision to stop reporting its broadest money supply measure was simply a recognition that money has become too complex to quantify, or an attempt to hide the accelerating debasement of the dollar, time will tell. But one thing is certain: The best gauge of gold’s near-term direction has now become impossible to calculate. Full Story
By: Roland Watson, New Era Investor - 2 April, 2006
What is the true value of gold? If one says 585 US dollars or 335 UK pounds, you may be getting near the answer but in the global world of depreciating fiat money, defining its value is like measuring yourself with a ruler whose inch scale is shrinking by the year. One year you are six feet tall, the next you are seven feet tall but you know you have not gained one inch in height! Full Story
Contrarian thinking is good to spot initial new trends but usually does not work to well after that and really does not pay off when it comes to predicting market tops. The philosophy involved behind the contrarian methodology is simple in fact too simple and hence can only work sometimes. The basis of this thinking is that one should always take a position that is opposite to that of the masses. Following this kind of thinking would have resulted in a total massacre during the 1990’s bull market; many so-called top-notch newsletter writers missed the entire tech bull of the 90’s. Full Story
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