I had written a post saying Current Thought would be delayed till late this evening tonight, but didn’t hit “Publish.” Sorry about that. I did write one line to help with current thinking:
Bottom line though for gold is we have not broke $1,100 and dollar has not broke below 97 on the index. Until that occurs, difficult to go long.
And that’s it in a nutshell. While others who write about gold will give this reason or that reason for gold to do what it does, from a micro, short term perspective, I have to look at the dollar and see if there is a correlation. I believe there is a good one and we need a break of 97 on the index to give gold a spark above $1,100. Until that occurs on a closing basis, gold and silver both look a little week or at best they are trending.
That said, I do lean a little long right now. Even though we are down after hours, there hasn’t been a real move lower in Asian trading. Most of Asia has their own issues to deal with as China and its government struggle with the Chinese stock market that can’t reverse the capitulation after such a strong run. This is what occurs in markets when they have gone too far on lousy or pretend even data. In the U.S. expect the same, but I don’t think just yet. Please wait till AFTER my next book is out!
Crude oil is up a bit as I type and so is Natural Gas. Copper, which got hammered again today (deflation anyone?) might be catching a bid. If most of these are green by the morning trading session, I would attempt longs in any of them, copper being the least attractive.
But I will say again and again, not always, but overall yes, I value it more than any other indicator; look at what the dollar does for a clue as to what gold/silver will do.
Also know that I am fully dollar bullish overall and still see gold breaking down, but definitely due for a bounce soon.
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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