5 replies to this topic

[Islander]

I think we can fall to 80 on the XAU.... if we can not decisively take out 112-115 and hold, consolidate, then climb to 125. If we go to 80, back up the truck, if you are not mentally deranged by then. The dollar rise that is apparently in the cards from last week, and weakness in the broad market are all pushing toward a gold decline, maybe a large one. If T-Notes top out this next week that will help the dollar fall and gold rise, but it is not total deliverance in a generally sour market. Islander.

[PorkLoin]

Hi Islander, What do you see that would indicate an apparent coming rise in the Dollar? Last week could be just a shake-out in the move up this year, but we could go down quite a bit, even while maintaining that uptrend, to say nothing of the larger bear market resuming. Seems to me the Dollar too could go either way, here. Best, Doug

[dougie]

gold and dollar are not siamese twins .....

[Islander]

I agree, but the dollar is traded based on its strength or weakness as indicated by probable future interest rates. I think it is becoming increasingly clear than a slow down or recession is in the cards, so the flight to short bonds may be the next step. That will not help gold. I am also concerned that the parabolic rise to 475 is part of a pattern where it falls about 60% of the rise not matter what happens to interest rates. It may be just my indigestion. Best Islander.

[dougie]

well a correction is in the offing: here or later. we know that. might as well be here

[PorkLoin]

I agree, but the dollar is traded based on its strength or weakness as indicated by probable future interest rates. I think it is becoming increasingly clear than a slow down or recession is in the cards, so the flight to short bonds may be the next step. That will not help gold. I am also concerned that the parabolic rise to 475 is part of a pattern where it falls about 60% of the rise not matter what happens to interest rates. It may be just my indigestion.

Very well said, Islander. I like the way you think. Agreed on the possibility of a large retracement of the parabolic move regardless of the larger picture.

I was all worked up on Friday through Sunday, trying to figure stuff out. Now we've had a couple pretty boring days in gold stocks. I'm not impressed with the HUI and XAU versus bullion, but consolidating here makes me think we're gonna try and push higher from last week's low. What happens up around the recent highs, if we get there, I have no idea. Bullion -- nice close today, but it feels like there's still a massive tug-of-war going on.

Silver is taking aim at the two highs from 2004 -- very interesting. Very pretty chart, but a lot remains to be seen. There too, "can go either way" seems applicable.

Best,

Doug