- Early this morning, gold may have achieved an
upside breakout from a key symmetrical triangle formation. Please click
- This chart provides an overview of the situation;
there is a symmetrical triangle (highlighted in black) sitting within a
giant drifting rectangle (highlighted in green).
- To view the possible breakout, please click
here now. FOMC minutes are scheduled to be released on Wednesday.
While that report could create some significant price volatility,
there's no question that this morning's technical breakout is a very
- The price of oil is rising in a near-perfect
uptrend. Please click
here now. Short-term traders can add to positions around the green
horizontal lines on the chart.
- The next upside resistance band sits at about
$103. I'll reduce my position by 5-10% in that price zone.
- Higher prices for food and energy put a lot of
upside pressure on the gold price. In the biggest picture, natural gas
has stopped falling and may be forming a significant bottom. Oil is
almost $100 a barrel, and last night soybeans surged to over $17 a
- All of this price action is being factored into
the gold chart, and an upside " price
geyser" is now a realistic possibility.
- Please click
here now. Silver is in a trading range between about $30 and $34.
This morning marks the 2nd day in a row that it is above important highs
- Silver seems set to perform well against the
dollar, but it also appears to be ready to make gold look like a bit of
a slug. Unlike most silver investors, I have no interest in selling
silver for " dollars of
- I view silver primarily as a currency. Gold is the
ultimate currency, and I think silver is best viewed as " gold's little brother". I
sold silver for gold in the first quarter of 2011, and now it's time for
me to buy silver with gold. Here's why:
- Please click
here now. This is the daily ratio chart of silver versus gold.
I've talked in the past about the importance of silver investors taking
pride in their mighty metal.
- Most investors use " gold:silver" ratio charts when analysing silver. I like to always put the item I'm
accumulating in an offensive posture on a chart, rather than a
- Silver staged a " breakout"
against gold from the red down channel, simply by trading sideways.
From there, it formed a symmetrical triangle, and yesterday it staged an
absolutely majestic breakout to the upside.
- The bottom line for silver is that gold's little
brother is talking. The question is, are you
- Having said that, most amateur investors often let
greed get the better of them. Just because one asset is probably set to
outperform another doesn't mean that you should invest so much risk
capital into it that you become emotionally broken, if things don't go
- It's a long way to Tipperary,
and the road to the highest prices targeted by enthusiastic silver
investors will likely feature some very ugly surprises.
- All I do in the market is ruled by the motto, "When
price declines, you should be emotionally uncomfortable, not screaming
in pain. Trade smaller than you know is rational. The greedy investor
with grand upside price targets will never beat the professional
investor, especially when it is time to go to sleep at night. Trade
small enough so that you are never overwhelmed by greed and fear."
- While I consider the August 7th-October 31st
timeframe to be "crash season", it's highly unlikely that the
will Dow crash right before the US elections.
- I don't know anyone who isn't nervous about the
market right now, other than myself. I always
sell all Dow stocks at the beginning of each crash season, but that
doesn't mean I'm bearish.
- Please click
here now. You are looking at the monthly chart for the Dow
Transports, and what is arguably one of the most bullish price patterns in
the history of markets.
- There appears to be a truly gargantuan bull
continuation reverse head & shoulders pattern in play. It has been
forming for five years. I think that most stock market investors are
probably underestimating the amount of quantitative easing being planned
by the Fed.
- The size and shape of that pattern indicate that
the Transports could rise to about 10,000. Could the Dow Industrials
double in price, from here? I think the Dow can double in price, and
will do so, because another round of quantitative easing would make
institutional money managers begin to view the dollar as the
"risk-on" trade, and the Dow as more of a currency and a
- What does that mean for your gold stocks? It probably
means they are going to rise quite dramatically. Please click
here now. The highs at point B were created by GDX banging into the
lows at point A.
- I plan to sell 5-7% of my position in the price
area around point B, but it should be noted that an upside breakout has
already occurred in a number of individual issues. GDX could quickly
burst over $48.72 in decisive fashion, and then begin a sort of "runaway"
move to the upside!
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and I'll send you my free "100 Hot Buys" report! I've identified
100 junior gold stocks that offer solid upside potential. I've rated them all
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