Best of the Week
Most Popular
1. Stock Markets and the History Chart of the End of the World (With Presidential Cycles) - 28th Aug 20
2.Google, Apple, Amazon, Facebook... AI Tech Stocks Buying Levels and Valuations Q3 2020 - 31st Aug 20
3.The Inflation Mega-trend is Going Hyper! - 11th Sep 20
4.Is this the End of Capitalism? - 13th Sep 20
5.What's Driving Gold, Silver and What's Next? - 3rd Sep 20
6.QE4EVER! - 9th Sep 20
7.Gold Price Trend Forecast Analysis - Part1 - 7th Sep 20
8.The Fed May “Cause” The Next Stock Market Crash - 3rd Sep 20
9.Bitcoin Price Crash - You Will be Suprised What Happens Next - 7th Sep 20
10.NVIDIA Stock Price Soars on RTX 3000 Cornering the GPU Market for next 2 years! - 3rd Sep 20
Last 7 days
The Connection Between Stocks and the Economy is not What Most Investors Think - 19th Sep 20
A Virus So Deadly, The Government Has to Test You to See If You Have It - 19th Sep 20
Will Lagarde and Mnuchin Push Gold Higher? - 19th Sep 20
RTX 3080 Mania, Ebay Scalpers Crazy Prices £62,000 Trollers Insane Bids for a £649 GPU! - 19th Sep 20
A Greater Economic Depression For The 21st Century - 19th Sep 20
The United Floor in Stocks - 19th Sep 20
Mobile Gaming Market Trends And The Expected Future Developments - 19th Sep 20
The S&P 500 appears ready to correct, and that is a good thing - 18th Sep 20
It’s Go Time for Gold Price! Next Stop $2,250 - 18th Sep 20
Forget AMD RDNA2 and Buy Nvidia RTX 3080 FE GPU's NOW Before Price - 18th Sep 20
Best Back to School / University Black Face Masks Quick and Easy from Amazon - 18th Sep 20
3 Types of Loans to Buy an Existing Business - 18th Sep 20
How to tell Budgie Gender, Male or Female Sex for Young and Mature Parakeets - 18th Sep 20
Fasten Your Seatbelts Stock Market Make Or Break – Big Trends Ahead - 17th Sep 20
Peak Financialism And Post-Capitalist Economics - 17th Sep 20
Challenges of Working from Home - 17th Sep 20
Sheffield Heading for Coronavirus Lockdown as Covid Deaths Pass 432 - 17th Sep 20
What Does this Valuable Gold Miners Indicator Say Now? - 16th Sep 20
President Trump and Crimes Against Humanity - 16th Sep 20
Slow Economic Recovery from CoronaVirus Unlikely to Impede Strong Demand for Metals - 16th Sep 20
Why the Knives Are Out for Trump’s Fed Critic Judy Shelton - 16th Sep 20
Operation Moonshot: Get Ready for Millions of New COVAIDS Positives in the UK! - 16th Sep 20
Stock Market Approaching Correction Objective - 15th Sep 20
Look at This Big Reminder of Dot.com Stock Market Mania - 15th Sep 20
Three Key Principles for Successful Disruption Investors - 15th Sep 20
Billionaire Hedge Fund Manager Warns of 10% Inflation - 15th Sep 20
Gold Price Reaches $2,000 Amid Dollar Depreciation - 15th Sep 20
GLD, IAU Big Gold ETF Buying MIA - 14th Sep 20
Why Bill Gates Is Betting Millions on Synthetic Biology - 14th Sep 20
Stock Market SPY Expectations For The Rest Of September - 14th Sep 20
Gold Price Gann Angle Update - 14th Sep 20
Stock Market Recovery from the Sharp Correction Goes On - 14th Sep 20
Is this the End of Capitalism? - 13th Sep 20
The Silver Big Prize - 13th Sep 20
U.S. Shares Plunged. Is Gold Next? - 13th Sep 20
Why Are 7,500 Oil Barrels Floating on this London Lake? - 13th Sep 20
Sheffield 432 Covid-19 Deaths, Last City Centre Shop Before Next Lockdown - 13th Sep 20
Biden or Trump Will Keep The Money Spigots Open - 13th Sep 20
Gold And Silver Up, Down, Sideways, Up - 13th Sep 20
Does the Stock Market Really "See" the Future? - 12th Sept 20
Basel III and Gold, Silver and Platinum - 12th Sept 20
Tech Stocks FANG Index Nearing Critical Support – Could Breakout At Any Moment - 12th Sept 20
The Tech Stocks Quantum AI EXPLOSION is Coming! - 12th Sept 20
AMD Zen 3 Ryzen 4000 Questions Answered on Cores, Prices, Benchmarks and Threadripper Launch - 12th Sept 20
The Inflation Mega-trend is Going Hyper! - 11th Sep 20
Gold / Silver Ratio: Slowly I Toined… - 11th Sep 20
Stock Market Correction or Reversal? The Jury Isn't Out! - 11th Sep 20
Crude Oil – The Bearish Outlook Remains - 11th Sep 20
Crude Oil Breaks Lower – Sparking Fears Of Another Sub $30 Price Collapse - 11th Sep 20
Inflation by Fiat - 10th Sep 20
Unemployment Rate Drops. Will It Drag Gold Down? - 10th Sep 20
How Does The Global Economy Recover After This Global Pandemic? - 10th Sep 20
The Best Mobile Casino - 10th Sep 20
QE4EVER! - 9th Sep 20
AMD Ryzen Zen 3 4800x 10 Core 5ghz CPU, Cinebench Benchmark Scores (Est.) - 9th Sep 20
Stock Traders’ Dreams Come True – Big Technical Price Swings Pending on SP500 - 9th Sep 20
Should You Be Concerned About The Stock Market Big Downside Rotation? - 9th Sep 20
Options Traders Keep "Opting" for Even Higher Stock Market Prices - 8th Sep 20
Gold Stocks in Correction Mode - 8th Sep 20
The law of long-term time preference and Gold ownership - 8th Sep 20
Gold Bull Markets: History and Prospects Ahead - 8th Sep 20
Sheffield City Centre Coronavirus Shopping Opera Ahead of Second Covid-19 Peak - 8th Sep 20

Market Oracle FREE Newsletter

How to Get Rich Investing in Stocks by Riding the Electron Wave

Drums Of War Spark Rally In Gold, Silver and Energy Prices

Commodities / Gold and Silver 2013 Sep 02, 2013 - 05:13 PM GMT

By: Hubert_Moolman

Commodities

A potential bull market in commodities, precious metals and miners could accelerate higher if Congress gives Obama the approval to attack Syria based on the use of chemical weapons of mass destruction against innocent civilians. Commodities, energy, gold and silver are safe havens that usually rise in value during international conflicts and war. Remember the major breakout in gold after September 11th in 2001 and the invasion of Iraq in 2003. The ramifications of increased involvement in the Middle East could have a major impact on global trade. The tensions with Russia is increasing as Putin supports Assad.


Just 8 weeks ago in late June, I alerted my readers to a major buy signal in gold (GLD), silver (SLV), junior mining stocks (GDXJ) and energy (XLE). I was absolutely amazed at the investor euphoria in equities at the time and the pessimism in precious metals and commodities and predicted correctly that the concern about War in The Middle East will spark a rally in oil, gold, silver and the miners.

When no one was buying and in fact shorting precious metals and energy, I was one of the only writers who said at the time, "This instability in the Middle East and around the world means investors should look for assets that maintain value during chaotic times. Precious metals and energy could be one of the safest areas to hedge against rising Middle East turmoil." Now 8 weeks later gold has rallied $200, silver has gone up more than $6 and oil (DBO) is about to break through multi-year highs and could move to $150 a barrel. All over the headlines investors are scrambling for safe havens as the U.S. prepares to invade Syria. Don't forget Iran which may be advancing quickly towards having a nuclear weapon. We should remember that Assad is a proxy for Iran.

The interest in safe havens particularly gold, silver and the miners are reaching short term overbought levels as investors flee to safety. In the middle of the summer I wrote, "Do not be surprised to see gold and silver which are down over the past two years make a "V" shaped reversal shaking out all those who sold during this correction. Although I don't want chaos to happen, many savvy investors believe this possibility is growing, especially with oil now breaking $100. I believe now may be the best time to protect oneself with precious metals, energy and really cheap junior mining stocks."

Now eight weeks later, all the talking heads who were saying to short gold two months ago are scrambling back in. The U.S. may launch an attack as Syria's Assad is now using chemical weapons. An attack on Syria could accelerate the move in gold, silver and energy, which may continue to rally just based on inflationary concerns alone.

Short covering combined with new value investors looking to hedge with this sector has caused an explosive move. Some of the technical indicators are short term overbought so be prepared to use consolidations as buying opportunities. Housing numbers and economic indicators look weak and I expect the precious metals to surprise the market which may incorrectly predicting tapering from QE by the Fed in September. We may see a consolidation for a couple of weeks in precious metals and energy after rallying impressively before Labor Day, as investors wait for the Fed in the middle of September.

Look for a consolidation in precious metals as a potential buying opportunity. Precious metals and the miners (GDX) may rally after this meeting as the market realizes the Fed may not be so motivated to start tapering in September and as the Middle East continues to flare up with conflict.



Technically, gold is short term overbought and reaching resistance at $1425. A short term pullback to the 20 day ($1353) or 50 day (1310) which are now both rising and making a bullish crossover for the first time in many months, may be healthy and provide a secondary buy-point.



The Gold and Silver Index ($XAU) has rallied close to 30 points since June and is entitled to a breather. Don't panic if the $XAU pulls back to the 50 day around 97. The 20 day has made a bullish golden crossover with the 50 day which is also beginning to slope higher. This is very bullish and could mean a rally to the 200 day at $126 after breaking resistance at $115. The XAU is forming a bullish ascending triangle pattern which could predict a potential breakout and long term bullish reversal.



Silver is experiencing an explosive move of over $6 since the low in late June and is overbought so long term investors should look to add on healthy pullbacks to the 20 day ($22.16) or 50 day (20.63). I believe the major two year downtrend was broken this past month in early August and possibly after a healthy pullback silver could rally past the 200 day at ($26.26). Investors should also consider the silver miners (SIL) which are performing nicely. Silver is outperforming other commodities over this past three month rally. This may be a signal that we could once again see silver make a powerful move similar to 2010 when silver ran from $18 to around $50.

Disclosure: Author does not own any securities mentioned.

For more silver and gold analysis and guidance, see my Long-term Silver Fractal Report   or subscribe to my Premium Service.

Warm regards and God bless,

Hubert
http://hubertmoolman.wordpress.com/

You can email any comments to hubert@hgmandassociates.co.za

© 2013 Copyright Hubert Moolman - All Rights Reserved

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules