Best of the Week
Most Popular
1. Investing in a Bubble Mania Stock Market Trending Towards Financial Crisis 2.0 CRASH! - 9th Sep 21
2.Tech Stocks Bubble Valuations 2000 vs 2021 - 25th Sep 21
3.Stock Market FOMO Going into Crash Season - 8th Oct 21
4.Stock Market FOMO Hits September Brick Wall - Evergrande China's Lehman's Moment - 22nd Sep 21
5.Crypto Bubble BURSTS! BTC, ETH, XRP CRASH! NiceHash Seizes Funds on Account Halting ALL Withdrawals! - 19th May 21
6.How to Protect Your Self From a Stock Market CRASH / Bear Market? - 14th Oct 21
7.AI Stocks Portfolio Buying and Selling Levels Going Into Market Correction - 11th Oct 21
8.Why Silver Price Could Crash by 20%! - 5th Oct 21
9.Powell: Inflation Might Not Be Transitory, After All - 3rd Oct 21
10.Global Stock Markets Topped 60 Days Before the US Stocks Peaked - 23rd Sep 21
Last 7 days
Stock Maket Trading Lesson - How to REALLY Trade Markets - 26th Nov 21
SILVER Price Trend Analysis - 26th Nov 21
Federal Reserve Asks Americans to Eat Soy “Meat” for Thanksgiving - 26th Nov 21
Is the S&P 500 Topping or Just Consolidating? - 26th Nov 21
Is a Bigger Drop in Gold Price Just Around the Corner? - 26th Nov 21
Financial Stocks ETF Sector XLF Pullback Sets Up A New $43.60 Upside Target - 26th Nov 21
A Couple of Things to Think About Before Buying Shares - 25th Nov 21
UK Best Fixed Rate Tariff Deal is to NOT FIX Gas and Electric Energy Tariffs During Winter 2021-22 - 25th Nov 21
Stock Market Begins it's Year End Seasonal Santa Rally - 24th Nov 21
How Silver Can Conquer $50+ in 2022 - 24th Nov 21
Stock Market Betting on Hawkish Fed - 24th Nov 21
Stock Market Elliott Wave Trend Forecast - 24th Nov 21
Your once-a-year All-Access Financial Markets Analysis Pass - 24th Nov 21
Did Zillow’s $300 million flop prove me wrong? - 24th Nov 21
Now Malaysian Drivers Renew Their Kurnia Car Insurance Online With Fincrew.my - 24th Nov 21
Gold / Silver Ratio - 23rd Nov 21
Stock Market Sentiment Speaks: Can We Get To 5500SPX In 2022? But 4440SPX Comes First - 23rd Nov 21
A Month-to-month breakdown of how Much Money Individuals are Spending on Stocks - 23rd Nov 21
S&P 500: Rallying Tech Stocks vs. Plummeting Oil Stocks - 23rd Nov 21
Like the Latest Bond Flick, the US Dollar Has No Time to Die - 23rd Nov 21
Why BITCOIN NEW ALL TIME HIGH Changes EVERYTHING! - 22nd Nov 21
Cannabis ETF MJ Basing & Volatility Patterns - 22nd Nov 21
The Most Important Lesson Learned from this COVID Pandemic - 22nd Nov 21
Dow Stock Market Trend Analysis - 22nd Nov 21
UK Covid-19 Booster Jabs Moderna, Pfizer Are They Worth the Risk of Side effects, Illness? - 22nd Nov 21
US Dollar vs Yields vs Stock Market Trends - 20th Nov 21
Inflation Risk: Milton Friedman Would Buy Gold Right Now - 20th Nov 21
How to Determine if It’s Time for You to Outsource Your Packaging Requirements to a Contract Packer - 20th Nov 21
2 easy ways to play Facebook’s Metaverse Spending Spree - 20th Nov 21
Stock Market Margin Debt WARNING! - 19th Nov 21
Gold Mid-Tier Stocks Q3’21 Fundamentals - 19th Nov 21
Protect Your Wealth From PERMANENT Transitory Inflation - 19th Nov 21
Investors Expect High Inflation. Golden Inquisition Ahead? - 19th Nov 21
Will the Senate Confirm a Marxist to Oversee the U.S. Currency System? - 19th Nov 21
When Even Stock Market Bears Act Bullishly (What It May Mean) - 19th Nov 21
Chinese People do NOT Eat Dogs Newspeak - 18th Nov 21
CHINOBLE! Evergrande Reality Exposes China Fiction! - 18th Nov 21
Kondratieff Full-Season Stock Market Sector Rotation - 18th Nov 21
What Stock Market Trends Will Drive Through To 2022? - 18th Nov 21
How to Jump Start Your Motherboard Without a Power Button With Just a Screwdriver - 18th Nov 21
Bitcoin & Ethereum 2021 Trend - 18th Nov 21
FREE TRADE How to Get 2 FREE SHARES Fractional Investing Platform and ISA Specs - 18th Nov 21
Inflation Ain’t Transitory – But the Fed’s Credibility Is - 18th Nov 21
The real reason Facebook just went “all in” on the metaverse - 18th Nov 21
Biden Signs a Bill to Revive Infrastructure… and Gold! - 18th Nov 21
Silver vs US Dollar - 17th Nov 21
Silver Supply and Demand Balance - 17th Nov 21
Sentiment Speaks: This Stock Market Makes Absolutely No Sense - 17th Nov 21
Biden Spending to Build Back Stagflation - 17th Nov 21
Meshing Cryptocurrency Wealth Generation With Global Fiat Money Demise - 17th Nov 21
Dow Stock Market Trend Forecast Into Mid 2022 - 16th Nov 21
Stock Market Minor Cycle Correcting - 16th Nov 21
The INFLATION MEGA-TREND - Ripples of Deflation on an Ocean of Inflation! - 16th Nov 21

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Gold Bullion Extended, Miners Just Beginning Potential Breakout

Commodities / Gold & Silver Stocks Sep 02, 2011 - 03:14 AM GMT

By: Jeb_Handwerger

Commodities            The action in the precious metals raises speculations of interest to Gold Stock Trades subscribers especially in the labyrinth created by a fear driven market.  Gold at this time is participating in a runaway move past resistance.  Although gold has reached new record highs it may be stalling in its attempt to continue moving parabolic, while the undervalued miners play catch up.  What may this hesitation signal and shrinking of the divergence between miners and bullion mean to my readers? 


           Technically, it may be informing us that the bull move so many analysts are expecting is somewhat mature in gold bullion but miners are just beginning to breakout.  Much like a sprinter who first moves backwards in his running block in order to propel his thrust forward, gold may initially have to come down from its technical heights in order to amass the energy required for a more pronounced forward move.  The bull headed minotaur of bullion may have to take a time out to rest, while the miners such as Goldcorp(GG), Newmont(NEM) and Barrick(ABX) play catch up as they look poised to break out of the running blocks. 

           Its been a long run for the beast since our late January 2011 Buy Signal.  Make no mistake Minos will rise refreshed to make another run to higher highs.  A brief retreat for gold bullion to long term trend support would be of no surprise.  Indeed, it may represent a healthy and necessary correction in what we view as the ongoing highway of the long secular rise.  These thoughts should not be regarded as bearish analysis at all.  Instead they are being presented as a technical and healthy possibility to eliminate current media hyped precious metals euphoria and avoid buying gold bullion at an interim top.  Instead we suggest looking into the undervalued miners just beginning a potential major move.

           Gold Stock Trades must include any and all eventualities.  How pleasant it would be if the ultimate path to riches was one straight move higher.  Investing does not work like that.  Markets are fickle and they do everything they can to confuse, misdirect and obfuscate the speculator.  Precious metals investors must follow bullion and the mining equities as everything has its season.  It appears to be the miners time under the sun.

           US Treasuries (TLT) have reached record highs reflecting the irrational fear of U.S. debt as a safe haven.  Gold (GLD) markets are ebullient as the media scares us with the bugaboos of horrific possibilities that may never come to pass.  Your attention is also called to the falling U.S. dollar (UUP), which appears to be on the verge of breaking into record lows.  It remains to be seen whether the panic in the greenback is just around the corner, as investors fear what impact QE3 will have on the currency.  One might have expected the U.S. dollar to be an iron clad safe haven during the market decline in August but it was not.

           Such negative action may mirror inflationary decisions regardless of whatever compromises reached.  There is a sense that inflation is in the offing and that now only a bandaid will be applied to staunch the bleeding of an economy in trouble.  

           In the background, is the ever present figure of The Fed which is taking whatever steps necessary to prime the pump to give us de facto quantitative easing in whatever guise is necessary to feed the Minotaur.  For the present, a compromise may materialize, sufficient to take us to the next election in 2012, when the whole song and dance will be reprised in a repetitious third act. 

           Preparations are being made for further downgrades of the U.S. AAA credit rating, which may affect the security of treasuries (TLT) as a safe haven.  As speculators are entrapped by the fear of bad news there may be a rush to the safe havens of gold(GDX) and silver(SIL) miners, possibly uranium(URA) and rare earth(REMX) miners as well.  Such developments may be leaving these sectors as the only players left standing on the field.   Stay tuned to my daily bulletin to keep track of these exciting sectors.

Disclosure: Long NGD, GLD, SLV, GDX

By Jeb Handwerger

http://goldstocktrades.com

© 2011 Copyright Jeb Handwerger- 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