Gold Editorials & Commentary

Last week we saw commodities sell down then put in solid bounce, which allowed us to generate new pivot lows for drawing support trend lines. This is the exact type of price action I have been waiting for.

The past week didn't see much movement in the end as indices were mostly flat. What was interesting to me was the big fall in markets world wide in the middle of the week while the US market hardly moved.

What a week so far!

Everything is playing out exactly as we hoped and expected this week. We have been so close to a buy signal in gold and silver but Monday's intraday observations saved us from a nasty trade.

When Stimulus Does Not Stimulate

The tables are fast turning against the deeply indebted USGovt officials. USA Inc is in deep trouble. Its productive engines in both finance and industry are either wrecked or sputtering, even as its debt burden grows exponentially.

The historic rule of thumb is that the S&P500 is correctly valued with a price/earnings or PE ratio of 14, the market normally hits the area of 7 at true bear market bottoms, and 21 at bull market tops.

Commodities are trying to hold their ground and could go either way quickly. There is a lot of chatter going on about gold and silver. I am hearing extreme theories from everyone I talk with.

For many years we have all reached a resigned indifference to the way inflation figures are manipulated to suit the masters of the day. The end result is that GDP growth is overstated and adjustments to wages and pensions muted.

The chances of gold breaking out to new highs in the near future are rapidly diminishing as the heavy hitters who have always prevailed up to this point are dramatically ramping up their short positions.

GLD - on buy signal.

Big round numbers are irresistibly alluring. There is some kind of psychological gravity about them that captures people's attention. Remember when the Dow 30 first breached 10k (March 1999) or oil first exceeded $100 (February 2008)?

It's that time again when the gold bugs come crawling out of the wood work.

A paradigm shift is underway, unrecognized inside the US kettle. Its water level is falling and its temperature is rising, even as fewer foreign born cooks stir its contents.

The rising tide lifts all boats, and that is exactly what we saw last week. Gold, silver, oil, natural gas, and stocks all put in a solid bounce last week.

The past week saw some major gains in the major averages helped by some good earnings by banks, which were offset by some major names disappointing in the earnings confessional.

GLD - buy signal this week.

Commodities have had a rough go lately, especially before this week. You couldn't open a financial newspaper or turn on CNBC without seeing endless bearish prognostications for raw materials' prices.

The globe is losing patience with leadership and management of the USGovt ship at sea.

Whilst this world's commerce still rotates on the unsteady axis of paper currencies, we will be subjected to a great deal of volatility and uncertainty.

Scenarios for the U.S. economy:

The Summer* doldrums are upon us with many investors more interested in the weather forecast than the markets.

GLD - on sell signal.

At the G8 conference a few days ago, the President of Russia, Medvedev, pulled a "gun" from his pocket.

Despite a 40% market recovery and an abatement of the credit crisis, a climate of high fear abounds among market participants. Investor sentiment polls continue to show an excess of bears over bulls as few believe that a recovery can be sustained.

The technical trader looks at the market much differently than most. While many investors are confused when looking at charts which have been marked up by a technician, more experienced traders look at these charts as a map.

"Banking was conceived in iniquity and born in sin. The Bankers own the earth.

GLD - on sell signal.

Sector timing commodities - Being able to trade different sectors is crucial for making a living in today's financial markets. One sector that cannot be over looked is the commodity sector.

Many are the obstructions to the so-called (mislabeled) deflation threat within the USEconomy. To begin with, falling asset prices does not constitute deflation.