After outperforming all major asset classes with a massive 20% advance in the past two months, gold prices have given back about one-quarter of that gain over the past week. Stronger-than-expected U.S. employment data for November and disappointing economic news in Japan and other parts of the world have led to the recent selling pressure. We believe that the current setback will prove only temporary, with the price of the yellow metal embarking on a new leg up in the near term. Looking out to 2010, however, the story will be different, as some of the favourable fundamentals underpinning gold prices will fade to some extent, taking the price of gold down to a new plateau. To the extent that prices rebound from their current level of about US$1125 per ounce, the more severe the medium-term adjustment is likely to be. [Read more...]

Let's start the technical story since it succeeded to build a technical base in the year 2005 from 415.00 zones, where the impulsive upside wave has started as seen on the weekly chart below. This chart explains how gold is preceding the grand fifth wave after forming 3 typical waves already when it placed the recorded high in March-2008 at $ 1035.00 per ounce. [Read more...]

In the last ten years, the financial world has experienced quite a few bubbles. Ten years ago there was the tech bubble. Then the housing bubble. And then the credit bubble. There was an Oil bubble too. With all these bubbles popping up, so to has an increase in bubble calling and contrarian thinking. As a result, sentiment analysis has become more popular. [Read more...]

There was a time not so long ago on this planet that obtaining information on gold, be it fundamental, technical or quantitive was a daunting task. From a technical price perspective, if you wanted to look at a chart you had two choices. You could buy the Wall St Journal, get the price, and then draw (yes draw) your price chart. [Read more...]

When you get right down to it, no matter what techniques one might rely on for his investment decisions there is one thing that they all have in common. In order to be successful an investor has to be on the right side of the longer term trends.

Gold prices have surged in recent months, which some observers claim is a clear warning that inflation will soon turn sharply higher as it did in the late 1970s. However, other forward-looking market-based inflation indicators do not support this hypothesis. Inflation indicators such as bond yields, consumer expectations and TIPS spreads have been running at fairly depressed levels, which suggest inflation will likely remain benign.1 If the spike in gold prices is not a sign of looming inflation, why are gold prices at a record high? [Read more...]

When it comes to Gold, there is actually too much focus or incorrect focus on the US Dollar. The fact is that throughout this bull market, Gold has been leading the US Dollar. In other words, the breakouts in Gold occur well in advance of the breakdowns in the dollar. Also, bottoms in Gold occur in advance of tops in the dollar. See the chart below. [Read more...]

Commodity speculators and investors (women excluded) can learn a lot by observing the purchasing habits of the “woman of the house.” Obviously it's not in all cases, and the statement is a generalization of the observations that some of us have which as you'll read is very complimentary and helps me make a point. Rather than call this a woman's job, it's really a job that men are horrible at and women quite frankly have to execute for the household. (Yes, many men can do it, I'm generalizing) Although sometimes women are accused of being big spenders or not careful. However in most cases and I think you'll agree, when you look really close, most women are very savvy and educated consumers. [Read more...]

Or more aptly some items of news and rumors which may have an impact on silver (and gold). The first is clear enough and is not rumor. Next Tuesday (28th July) the CFTC will begin its hearings into discussing position limits in energy commodities as well as the exemptions some so called hedgers enjoy when they multiply their futures contracts even more. [Read more...]