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1. The 2012 phase of the great gold war is
underway. Click today's gold chart now, to watch gold
start the year in winning fashion.
A small band of dollar bug “snipers” sit in the $1600
price zone, but don’t expect them to draw much blood from our golden
warriors.
2. Note the solid positioning of the MACD here. The excellent action in gold is being
mirrored by silver. You need a
solid two month time frame between the two bottoms to have a real double
bottom chart pattern. Silver has
about three months between the bottoms in place, which is acceptable.
3. Click this silver chart now. There is definitely double bottoming
action on this chart, and silver did not confirm the gold market’s move
to new lows last week. Note the
rising trend of the MACD from the first bottom.
4. Silver is likely to be subject to strong incoming
liquidity flows
because this is an election year. Government people want to
“juice” the stock markets higher. Silver is an industrial metal as well
as a precious metal, and 2012 could see silver mount a very big rally against
the dollar.
5. There is a rumour that William Shakespeare wrote his
famous “Much Ado About Nothing”
play for gold investors who became paranoid after the triangle formation
failed on the gold chart.
6. There is now a similar triangle pattern on the
Canadian dollar chart, only this time it looks like the US dollar is the
entity that is set to fall apart.
7. Click this USD:CAD chart
now. Canada’s central bank
governor has issued several “get
ready for some pain” alerts to the Canadian people, and a rising
Canadian dollar could be part of the picture he is painting.
8. There is a perfect symmetrical triangle in
place. It has a 2/3 chance of
seeing the USD dollar break out to the upside, but early this morning the
demand line cracked. It
doesn’t look good for the US dollar.
9. I don’t think I remember a time in this gold
bull market when there were so many gold-positive items in play across such a
wide array of markets.
10. The Financial Times reports, “Hedge funds increased their bets against
the euro to a record level in the last week of 2011, increasing pressure on
the embattled European common currency as it enters the most testing year of
its history.” –FT, Jan 3, 2012.
11. The enormous commercial traders are on the other
side of that trade, long the euro, and their stance is another bullish factor
for gold.
12. In the longest term, sadly, you will likely find
that the only thing an ounce of gold buys more of than it did at the start of
the gold bull market is dollars,
and the only use for those dollars could be fireplace fuel. That
hard lesson will be learned down the road, and I don’t want to rain on
anyone’s dollars-of-wealth parade so early in 2012. Or do I?
13. If you want to get richer, you have to buy more gold
when it is on sale, and put it on your scale. If the number on your scale is not
getting bigger, it is quite unlikely that you will ever get richer with
gold.
14. Jim Rogers said on Dec 28 in a CNBC interview,
“If I were buying anything
I’d be buying agricultural commodities… ”Going forward
we’re going to have huge shortages of everything – including
farmers – I think ag will be a great place
for the next 10-20 years….”
15. While I own corn and wheat, I’d like you to
think more about the implications of a ten to twenty year period of generally
rising food prices, and what that situation could mean for gold, silver, and
gold stocks.
16. Click this corn chart now. This is one of the best looking charts
in any market, and rising corn prices cause institutional money managers to
get concerned about general inflation.
17. When they get concerned they buy gold and some
silver.
18. The year 2011 saw the destruction of a lot of short
term traders. The gold community
lost a lot of good people. They
liquidated into the lows, which is understandable, especially when you think
about the fact that many gold stocks have never recovered to even the 2006
highs.
19. If you are one of the people who sold out, just
stand back this morning.
Don’t try to chase the gold price higher anymore. The flip trading “thing”
is over. We’re in a new
phase of the gold bull market, and you need a wider view, much bigger trade
increments, and a lot more patience.
20. If you believe this crisis could go on for decades,
then it is more an act of sanity than tactical action to embrace wider buy
and sell price increments. Make a
resolution to tone down the obsession with predicting the next minor trend
move.
21. Click this GDX sell targets chart now. The bottom gold stocks line is that
when the price of GDX broke under $50, there “should” have been
massive volume, but there was very little capitulation.
22. Sellers of gold stocks have dried up like dollar
bugs baked by a golden sun. If
you bought gold stocks into the recent lows, on the upside you should be
looking the resistance from the dollar bugs coming into play at about $53.70,
$54.80, and $57.
23. That resistance doesn’t mean you sell
there. I’d like to see you
holding more gold stock for bigger moves in 2012. Just be aware that sellers exist in
size at difference areas on the chart, and not every down day in gold or
silver is due to gold being “manipulated”. You breathe in and breathe out with
your lungs. Allow your stocks to
do the same thing without you calling 911 every 30 seconds.
24. The cold reality is that those “manipulating
gold lower” recently were only those investors who sold themselves out of it.
The banks didn’t “manipulate gold lower”. They bought as it fell, and if they
hadn’t, gold would have fallen vastly further. Let’s make 2012 the year that
you end your personal manipulation of gold and gold stocks, by never again
selling out of them on weakness.
See you out there, on the gridlines!
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Thanks
Cheers
St
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