1. Greece is back in the news. Street demonstrations
are in play today, and across the EU, the IMF predicts ongoing deflationary
pressures. They are urging the ECB to
keep rates low, for an extended period of time.
2. Please click
here now. That’s a two day chart of the euro, and you can see the
negative reaction to the ongoing turmoil.
3. The Dow also broke its two day lows this morning,
following the euro’s tumble. To view the break, please click
4. Regardless, on numerous occasions, Ben Bernanke has
stated his commitment to print money, and lend it to the EU. In the big picture, his endeavor is very
positive for gold prices.
5. Please click
here now. You are looking at the two day gold chart, covering the same
time frame as the euro and Dow charts. Note that gold “refuses” to take out its lows.
6. While the short term picture for the euro may be
negative, the picture for gold is much less so, and real wealth certainly isn’t built and maintained, by
attempting to ascertain the next 5% move for gold.
7. Most of the emails I’m getting now from gold
investors are focused on the theme of an “imminent price correction”, and a lot of gold market
commentary in the mainstream media is turning cautionary as well.
8. This overwhelmingly negative sentiment leads me to
believe gold prices are likely to move higher, even in the short term.
9. I’m a little worried that many of the
investors selling gold-related items in this price area may be booking
losses, rather than gains. If you bought a gold stock at $10, and it fell to
$2 during the 2011-2012 wipe out, should you sell it at $5 now, to “avoid a correction”? The answer is a thunderous “no”.
10. Please click
here now. That’s a one year gold chart. The $1535 area lows are
highlighted by thick green lines, and the $1815 area highs are marked with
thick red ones.
11. I believe that gold is “preparing” to leap over the $1815 highs. If you are
properly capitalized, you should have no concerns at this point in market
12. Regardless, I’d like you to be prepared to buy
each of them, with limited risk capital. Also, if you lightly shorted gold
into the rally towards $1800, you could book profits on a decline to any of
those same HSR lines.
13. Regardless, I’d like you to be prepared to buy
each of them, with limited risk capital. If you are carrying a modest “parachute” of short positions
you added into this rally, as I am, those key HSR lines are where you would book profit.
14. In a super-crisis, it’s critical for precious
metals investors to “think
big”. If a decline to point number 5 on that chart at $1610 seems
like a nightmare, then you may want to consider reducing the amount of risk
capital you are bringing to bear in the market, on your entry points.
15. I’ve referred to the entire $1535-$1923 price
area as a “training zone”.
It’s an opportunity, to learn to focus on the bigger market movements,
and the more important price support areas, which are $1432, $1577, $1805,
16. Focus on applying capital on the buy side into those
prices, rather than trying to analyse your way to riches by calling the next
short term move. Gold is the ultimate
asset, and ultimate patience is required to build wealth with it.
17. A large part of successful investing is facing fear,
and refusing to yield to it, with market action. Please click
here now. You are looking at a long term weekly chart of the HUI gold
18. I’d like you to make note of the overbought
condition of many of the oscillators.
19. There is a terrifying head & shoulders top
pattern in play, and the current highs are occurring at the same time as gold
fights with the $1800 level.
20. My question to gold stocks investors is this: Is
that head and shoulders formation a legitimate price pattern? Or, is it just a meaningless shape on the
chart? I’m convinced that it’s just a shape.
21. My professional opinion is that no gold-related item
should be sold at a loss. If it’s sold at a loss, then it
shouldn’t have been bought in the first place. I’m not afraid of
that supposed top pattern at all. Here’s why:
22. Please click
here now. If you are gold stock investor, I would argue you need to look
at this long term monthly HUI chart a lot more often than you look at the
short term charts.
23. I call it the “King Daddy” of all gold stock charts. Please make note of
the two previous highs to the left of the chart, at 519.68 and 516.16.
24. The HUI has already taken out those highs on this
rally, and appearing to be “flagging”
here, not correcting, for a price blast up to the 638 area highs, which is
your real profit booking area!
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