Gold Editorials & Commentary

The week was a wild one with lots of choppy action in the indices as was to be expected as bases build here nicely. We had options expiration this past Friday as well so that usually tends to throw a wrench into things.

GLD - on sell signal.

Action yesterday across markets was bearish and set alarm bells ringing - in particular the action in the PM sector, where the Head-and-Shoulders bottom pattern that we have observed in PM sector stock indices appears to be aborting.

Not even mighty gold escaped late September's commodities massacre, so gold stocks never stood a chance. They were sucked into the violent maelstrom of commodities-stock selling, plunging sharply.

"There is gold in them thar hills!"

We're in the midst of an amazing run off the recent lows in the stock market. As tempting as it is to buy some of leaders now, I think it would be a grave mistake. Nothing goes straight up so we have to be patient and wait for the proper buy points.

GLD - on sell signal.

The recent recession-fear craze hammered commodities prices, crushing the stocks of the companies that produce them. Commodities stocks were wholesale abandoned by frightened traders, left bludgeoned and bleeding.

Over the past year we have been learning more about the financial situations across the pond in Europe. With international issues on the rise, investors are panicking trying to find a safest haven for their capital.

An important reversal of focus, expectation, and direction has taken place in Europe. Put aside the sovereign debt mess that will not go away. It will not be fixed, despite all the effort and talk and deal making.

That is correct, book the funeral, because if common sense and the free market are not allowed to resurrect themselves, we are destined to fall into the hole we have created.

It was a wild week to be sure and we've hit a tentative bottom in US equity markets with the S&P500 printing a double bottom pattern as I'd hoped would occur.

GLD - on sell signal.

"A morsel of genuine history is a thing so rare as to be always valuable."

Thomas Jefferson

The recent sharp selloffs in stocks and commodities have fueled an incessant drumbeat of pessimism plaguing the financial markets. Greece is doomed, Europe is fracturing, China is slowing, the US faces a recession, the sky is falling!

I want to correct a mistake I made on my table for the foreign central bank holdings of US Treasury debt in my last article.

Many investors pigeon-hole themselves as "inflationists" or "deflationists", where an inflationist is someone who expects more inflation over the years immediately ahead and a deflationist is someone who expects deflation.

The USTreasury Bond rally over the last few months has been celebrated. Some call it a contradiction of the Standard & Poors debt downgrade of USGovt debt. Some hail the rally as proof that the USDollar remains respected as global reserve currency.

I have good reason to believe that the general markets are headed lower here immediately and there is a good potential of a low being put in this coming week or the next before we may well see a strong rally through the end of 2011.

In classic fashion gold's brutal plunge ended in a zone of strong support just above its 200-day moving average.

GLD - on sell signal.

Over the past week precious metal investors have had a wakeup call from their big shiny nest eggs. Last week's free fall in both gold and silver spot prices was enough to get investors into a panic. More on this in a minute though...

The US dollar is becoming less attractive to central banks as a reserve asset.

The mainstream media does a terrible job with analysis. No secrets there. However, some aspects of this incompetence are so fundamental to their basic duties as to be completely unforgivable.

The Gold (and Silver) bull continues to closely follow the giant wave formation of a tsunami.

A few weeks ago I wrote about how gold was starting to top and that everyone should expect a very sharp drop to the low $1600 area.

It was quite the week to come back to after being away for the past two weeks with little to mostly no internet access.

GLD - on sell signal.

This week ended with the Mr Bear tipping over the portfolio valuation of professional money managers, and individual investors, alike. He's after garbage, and there is no shortage of that in the world's financial markets.