I’m sticking with my feeling that we still get a bounce in gold and silver even though we saw a solution for the Greece situation. The mining stocks listened to my predictions yesterday but the physical metal price listened to the higher dollar and stayed down throughout the day. I put up a daily chart of the dollar below. We are seeing some consolidation at present and will break out from this level. The perception may very well be that the Euro gets some love for the time being. I would look for a break below 94 as confirmation of this love and it may spark a rise in gold and silver for a bit.
But things are far from over for Greece and the other countries that represent the Euro. I still see issues there and we’ll be right back where we are today trying to resolve these issues again. But this next round may be the end of speculating that Greece can be saved. This next round may see other European countries revealing their issues with debt and if we throw Japan into the mix again, the dollar can very well move up to the 120 range in no time. I believe this will be the trigger for gold to break below $1,000.
For now, the market perceives that all is well here in the U.S. The market of course ignores all the data that has come out this year and looks at the current improved unemployment report, not the U-6 report that still shows the unemployment rate double digit.
This perception has treasuries again up to 2.45%. I don’t think we go much higher here and would look at dipping into TLT soon as I think rates fall below 2% soon enough. We were just here.
Doug Eberhardt is a 28 year financial services veteran and precious metals broker selling gold and silver at 1% over wholesale cost. Doug has written a book to help investors understand how gold and silver fit into a diversified portfolio, how to buy gold and silver, and what metals to buy. The book; “Buy Gold and Silver Safely” is available by clicking here Contact phone number for Buy Gold and Silver Safely is 888-604-6534
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