Wednesday, January 25, 2006
'Caution The Operative Word' As Gold Soars
MarketWatch has the metals trading numbers. "Metals futures marked a broad advance Wednesday, with gold closing with an over $4-an-ounce gain, copper reaching a record level and silver and platinum prices tapping multi-year highs. Gold for February delivery rose to a high of $566.90 an ounce on the New York Mercantile Exchange before closing at $562.50, up $4.40, or 0.8%."
"'The huge pool of global liquidity out there has not found a better place to rush into, and is enchanted with gold and its prospects,' said Jon Nadler, an investment products analyst at bullion dealers Kitco.com. From here, 'unless the commitment to the metal has a long-term orientation, the air pockets that lie ahead will look and feel quite frightening,' said Nadler."
"'Current trading range is seen between $540 and $580 with the outside of the envelope at as wide as $490 to $600,' he said, adding that 'caution remains the operative word.' Indeed, Dale Doelling, chief market technician at Trends In Commodities, said he sees the fresh buying Wednesday as 'highly suspect.' 'Gold continues to suffer from an overbought condition and I'd advise only the bravest of traders to add to long positions at this juncture,' he warned."
"A retest of the recent lows around $540 seems to be the 'most likely course,' but if that happens, 'it would set up an excellent entry point for new positions,' he said. There's a 60% to 70% change that the market will 'see some retracement in gold, as well as Silver, before any new highs are achieved,' he added."
"'Gold continues to suffer from an overbought condition and I'd advise only the bravest of traders to add to long positions at this juncture,' he warned."
"'Without any fresh bullish news, one has to assume that it is the funds and the weight of money that is once again pushing these prices higher,' said William Adams, an analyst at BaseMetals.com."
"March silver finished up 28.2 cents, or 3.1%, at $9.51 an ounce. It traded as high as $9.54, a level not seen since mid-1987. With the break above the resistance mark of $9.30, 'silver now looks to target the $9.50-$10 level with renewed momentum back in the market,' said Peter Spina, an analyst at GoldForecaster.com."
"April platinum closed at $1,064.80 an ounce, up $6.80, after touching another 26-year high of $1,068. Sister metal palladium saw its March contract tack on $7.80 to close at $283.90 an ounce."
"The CBOE Gold Index (GOX), which traded at $4.38, with a 4% rise in shares of Coeur d'Alene Mines (CDE)leading the strength among the benchmark's components. The Philadelphia Gold and Silver Index (XAU) was at 313.09, up 2.4%. Other notables among metals companies included Hecla Mining (HL), which climbed 5.6% to stand at $4.33 and Apex Silver Mines (SIL) up over 3%."
"'The huge pool of global liquidity out there has not found a better place to rush into, and is enchanted with gold and its prospects,' said Jon Nadler, an investment products analyst at bullion dealers Kitco.com. From here, 'unless the commitment to the metal has a long-term orientation, the air pockets that lie ahead will look and feel quite frightening,' said Nadler."
"'Current trading range is seen between $540 and $580 with the outside of the envelope at as wide as $490 to $600,' he said, adding that 'caution remains the operative word.' Indeed, Dale Doelling, chief market technician at Trends In Commodities, said he sees the fresh buying Wednesday as 'highly suspect.' 'Gold continues to suffer from an overbought condition and I'd advise only the bravest of traders to add to long positions at this juncture,' he warned."
"A retest of the recent lows around $540 seems to be the 'most likely course,' but if that happens, 'it would set up an excellent entry point for new positions,' he said. There's a 60% to 70% change that the market will 'see some retracement in gold, as well as Silver, before any new highs are achieved,' he added."
"'Gold continues to suffer from an overbought condition and I'd advise only the bravest of traders to add to long positions at this juncture,' he warned."
"'Without any fresh bullish news, one has to assume that it is the funds and the weight of money that is once again pushing these prices higher,' said William Adams, an analyst at BaseMetals.com."
"March silver finished up 28.2 cents, or 3.1%, at $9.51 an ounce. It traded as high as $9.54, a level not seen since mid-1987. With the break above the resistance mark of $9.30, 'silver now looks to target the $9.50-$10 level with renewed momentum back in the market,' said Peter Spina, an analyst at GoldForecaster.com."
"April platinum closed at $1,064.80 an ounce, up $6.80, after touching another 26-year high of $1,068. Sister metal palladium saw its March contract tack on $7.80 to close at $283.90 an ounce."
"The CBOE Gold Index (GOX), which traded at $4.38, with a 4% rise in shares of Coeur d'Alene Mines (CDE)leading the strength among the benchmark's components. The Philadelphia Gold and Silver Index (XAU) was at 313.09, up 2.4%. Other notables among metals companies included Hecla Mining (HL), which climbed 5.6% to stand at $4.33 and Apex Silver Mines (SIL) up over 3%."
# posted by Ben Jones @ 12:42 PM 
Comments:
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it is different this time and for a reason. gold was in a long-term downtrend that lasted 20 years. notw it's going up. gold is not even close to it's old highs, nor is it overvalued by just about any standard.
As credit tightens up and 'deflates the housing balloon,' gold should be seen as a safe haven. Will it still be considered overbought as there will be more buyers?
Does anyone think that a gold exit point will coincide with a housing entry point? I'm thinking the exit point will be much sooner, and could this be a telling that a housing entry point would be coming within 12 months after?
Does anyone think that a gold exit point will coincide with a housing entry point? I'm thinking the exit point will be much sooner, and could this be a telling that a housing entry point would be coming within 12 months after?
Agree with some that gold is a safe haven for troubled times- and plenty of that ahead. I don't believe gold has future with average American investor, i.e., those who played along in Stock and house bubbles. More important will be foreign and domestic central banks.
(since gold is only really useful as jewelry and that is a price sensitive market.)
what about the fact that gold has been money for a few thousands years?
gold, or ANY investment, will see more $ as the price goes up and people realize it. how many people were not invested in 1995 in US stocks were suddenly geniuses in 2000? the price rise will create investment demand from the average joe, no matter what the asset class.
what about the fact that gold has been money for a few thousands years?
gold, or ANY investment, will see more $ as the price goes up and people realize it. how many people were not invested in 1995 in US stocks were suddenly geniuses in 2000? the price rise will create investment demand from the average joe, no matter what the asset class.
in a hyperinflation lots of people have useful skills/tools, lots of people don't have gold. I know which one I want. who is going to have the money to pay you for your skills anyway in a hyperinflation?
because, if I'm not mistaken, many banks can call in a loan at anytime. I don't think hyperinflation is coming, but bernanke has said he'll drop money from helicopters if there is a whiff of deflation. I think deflation will happen because of so much debt. so if you load up on debt now you better be able to hold out until(or if) hyperinflation arrives. if you lose your job debt is not what you want to be in. after deflation hit and ended in 1932 the rest of the period was inflationary. it was a boom for commodities until the late 40s.
so, lots of debt causes deflation which is combated by inflation. whether it's New Deal style inflation or weimar-style hyperinflation I don't know.
so, lots of debt causes deflation which is combated by inflation. whether it's New Deal style inflation or weimar-style hyperinflation I don't know.
amablamdream said: "I am also invested in uranium because I don't see how the world can avoid moving to nuclear generated electricity. There is just no other source that will meet demand."
What about nanosolar? Companies are developing solar panels that will be better and less costly than the ones manufactured in the 70's. The FEDs are funding money to some SV companies for D&D. Granted, a state has to have more sunshine than not, but areas that have ample sunshine will benefit when energy costs get to the breaking point.
What about nanosolar? Companies are developing solar panels that will be better and less costly than the ones manufactured in the 70's. The FEDs are funding money to some SV companies for D&D. Granted, a state has to have more sunshine than not, but areas that have ample sunshine will benefit when energy costs get to the breaking point.
"you should be buying on credit all the hard assets you can, promising money that will soon be worthless. The ability to get 100%, no down payment housing loans presents an unequaled opportunity right now."
Right, I dont have money to buy overpriced RE, buts thats o.k, but its a good idea to get a 100% loan right now because the dollar is falling? The RE bubble is bursting, prices are falling, you are saying its a good investment? sounds backwards if you ask me.
Right, I dont have money to buy overpriced RE, buts thats o.k, but its a good idea to get a 100% loan right now because the dollar is falling? The RE bubble is bursting, prices are falling, you are saying its a good investment? sounds backwards if you ask me.
amadablamdream:
I have a hard time believing that a bull market in gold will last that long since gold is only really useful as jewelry and that is a price sensitive market.
History shows that gold performs best in bad times, not good. Lots of people buying jewelry in bad times, right?
All their talk of The Great Depression, version 2.0 puts them firmly in crackpot territory in the minds of most people.
Most people are ignorant as hell, that's why we call them sheeple.
Right now I am hoping that the price of a barrel of oil goes back down into the thirties...
That's less likely than a new depression. Luckily your uranium investments should make up for losing your shorts on energy! ;)
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I have a hard time believing that a bull market in gold will last that long since gold is only really useful as jewelry and that is a price sensitive market.
History shows that gold performs best in bad times, not good. Lots of people buying jewelry in bad times, right?
All their talk of The Great Depression, version 2.0 puts them firmly in crackpot territory in the minds of most people.
Most people are ignorant as hell, that's why we call them sheeple.
Right now I am hoping that the price of a barrel of oil goes back down into the thirties...
That's less likely than a new depression. Luckily your uranium investments should make up for losing your shorts on energy! ;)
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