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- Gold Seeker Closing Report: Gold and Silver Fall About 1%
- The Gold Frenzy?
- Someone Please Explain To My How There Can Be A Bubble In Gold And Silver
- Run on silver has coin shops scrambling
- Goldrunner: Fractal Analysis Suggests Silver to Reach $52 – $56 by May – June 2011
- The Silver Economy
- The Dollar Is Not Sick, It's Terminal
- Interview With a Trading Legend, Part V: The Toughest Trade
- iShares Silver Trust ETF Is Good But Try Mining Stocks as Well
- Oracle: The Giant Moves Quietly in M&A
- Markets by The Numbers
- Currency ETFs and the Carry Trade
- Gold Over £900/oz as British Pound Falls Sharply…
- Nuclear crisis: Japanese gov't raises severity rating to highest possible level
- The world's top trading firm is calling a top in commodities
- Why high oil prices could be here to stay this time
- Mining stocks vs. Physical gold and silver
- Gold & Silver Slip as Goldman Says "Sell Commodities", Interest-Rate Hikes "Further Delayed"
- Targets for Gold Stocks
- Why a $1m short-option against July silver is not so crazy
- Gold and Silvers Daily Review for April 10th, 2011
- Ebay / paypal and tax reporting
- Buy Pullbacks in Gold & Ignore the Top Callers: Richard Russell
- Alasdair Macleod: Interest rates and Plan B
- Who Are the Real Victims of a U.S. Dollar Crash?
- Analysts warn of silver sector overheating
| Gold Seeker Closing Report: Gold and Silver Fall About 1% Posted: 12 Apr 2011 07:12 AM PDT Gold reversed overnight losses and rose to see a $0.59 gain at $1467.29 by about 9AM EST before it dropped back down to as low as $1444.08 by midmorning in New York, but it then bounced back higher in late trade and ended with a loss of just 0.93%. Silver climbed to as high as $40.878 before it dropped to as low as $39.72 and then also bounced back higher in late trade, but it still ended with a loss of 1.33%. |
| Posted: 12 Apr 2011 06:59 AM PDT The longer I invest, the more I understand that there is a certain temperament you need to be profitable. This is not a pure data-driven field- otherwise investment banks with their fancy tools and teams of analysts could actually predict events instead of being overrun by them. You need to feel out markets. You need to understand history. You need to be objective. And you need to be willing to stand by your convictions, especially when you hold an unpopular view. Once upon a time, gold was a very unpopular trade because it went down year after year. Now it is an unpopular trade because it has gone up year after year. It seems that no matter what gold does, there will be a healthy dose of skepticism from the mainstream. Believe it or not, I am comforted by the fact that there are so many people who believe gold is in a bubble. Having people on the other side actually helps you clarify your thoughts. It is very important to know how many people think differently from you and why. Fighting the Crowd In everyday life, social proof, or modeling your behavior on the behavior of others, is a shortcut to good decision-making. In investing, social proof often gets you killed. But just because I tell you not to be swayed by social proof, doesn't mean it won't happen. Social proof is the engine of exuberance-driven booms and panic-driven busts. It is an irrational boom in gold and silver that I'm sure has many readers of this blog concerned; a frenzy in gold will be my signal to get out. I have heard throughout the bull market in gold that it is a bubble. People who have no experience living through the 1980 bubble top in gold are making these claims because MC Hammer was in a gold-related commercial. How interesting. Anyway, I take a different approach. I have spoken to gold dealers who are telling me that buying activity in gold has not risen in this latest rally. They are also telling me that the current level of public participation in gold is nothing compared to the frenzy in 1980. How is there a gold bubble if the public isn't buying? As always, it is a matter of perception. The interesting thing about gold is that it will become more popular at $2000 than it was at $500. The economic backdrop when gold is trading at $2000 should be pretty interesting. I'm guessing there will be debt defaults, higher inflation, and some form of civil unrest. At the top, it will be incredibly hard to sell. We are not there yet. The investors in gold up to this point have been strong hands and dip buyers. Gold will reach new heights when the public gets involved. Source: The Gold Frenzy?
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| Someone Please Explain To My How There Can Be A Bubble In Gold And Silver Posted: 12 Apr 2011 06:05 AM PDT |
| Run on silver has coin shops scrambling Posted: 12 Apr 2011 04:56 AM PDT Run on silver has coin shops scrambling Buyers worried about the dollar and inflation are driving up the metal's price. Doug Engle/STAFF PHOTOGRAPHER Will Moore, a numismatist for 14K Gold & Diamond Center in Ocala, shows a silver bar that he recently purchased from a customer. By Ann Sperring Correspondent Published: Saturday, April 9, 2011 at 10:49 p.m. Last Modified: Saturday, April 9, 2011 at 10:49 p.m. It may not be another California-style gold rush, but a silver stampede is occurring in local coin and antique shops. Silver, which has doubled in value since September, reached a 31-year high Friday at $40.46 per ounce, a price not seen since the Hunt brothers attempted to corner the silver market in the 1980s. The effect: Speculators and collectors are snatching silver off the shelves of local shops. Platters, pitchers, cutlery, jewelry and coins are selling at a brisk pace, retailers say. "We actually have people coming in with scales to weigh our silver pieces and our coin dealers are having to constantly restock and re-price," said Janice Daniel, co-owner of Ole Cracker House Antique Mall in Ocala. "We even have out-of-state dealers coming in, hoping to replenish their depleted stocks." Leading numismatists began predicting the current rush on silver over a year ago when gold prices began to soar. Lewis Revels, owner of Chattanooga Coins, a major national wholesaler based in Georgia, said in an interview with Star-Banner in 2010 that increased industrial use of silver, soaring gold prices, inflation fears and concern about the dollar's stability would influence silver prices. "Silver is the most dangerous commodity to be without when the market moves," he repeated in a recent release to dealers, collectors and investors. Revels said U.S. silver coins, especially silver eagles and dollars, offer the highest potential return. He also cautioned investors to avoid foreign gold issues such as Krugerrands and Austrian mint issues. Will Moore, an independent certified coin dealer with 14K Gold in Ocala, reported long lines when silver eclipsed $38 per ounce earlier this month. "I am seeing buyers and sellers, but buyers are far more numerous. The demand for certain coins and bullion denominations is outstripping supply in some parts of the state, and I am pulling reserve inventory at a steady rate," he said. Moore said premiums are being paid for high-demand coins. "Silver eagles are very hot right now, and the low mintage (U.S. Mint) is contributing to a shortage in some shops. The next most popular is the 10-ounce silver bar," he said. Moore said many of his fellow retailers believe the current prices are sustainable and likely to increase. "There are a number of factors in play that influence the precious metals and currency prices. Increased industrial use, especially in electronic components, the increasing price of gold driving investors into more affordable silver, and lack of trust in the currencies of the global economies are all contributors to the run up," Moore said. The price and interest jumps are not limited to just bullion, according to Moore. "Middle-grade certified coins are also seeing an increase, with common coins graded Mint State (MS) 63 or MS 64 bringing the highest prices," he stated. Certified coins, also referred to as slabbed coins, are those evaluated by an independent third party grading company with no financial interest in the coin. Grades can range from almost good to MS or Proof (PR) 70, the highest numeric grade. Lee Soule of Ocala was unaware of the recent price increases until she sold some silver coins to an Ocala dealer earlier this month. "I just needed a little extra cash and I had these (coins) a friend gave me several years ago. I was really surprised and pleased by the price I got, especially since my friend had said, and the dealer confirmed, these were just common coins," she said. Coin dealers are not the only ones struggling to keep coins in stock. Bob Flinn owns an antique shop in south Georgia and is experiencing the same surge as local shop owners. "We cannot keep silver items stocked. We have buyers, many of them dealers, coming in from as far away as Atlanta. The dealers are coming looking for inventory items," he said. Some antique dealers, including Daniel of the Cracker House, have mixed feelings about the silver stampede. "I really don't enjoy selling a beautiful antique work of skilled craftsmanship knowing it is destined for a melting pot. Many irreplaceable treasures are being lost because we are selling pieces of our history. As a merchant, I am happy for my dealers, but as an antique lover I am saddened," she said. http://www.ocala.com/article/2011040...=1&tc=pg&tc=ar |
| Goldrunner: Fractal Analysis Suggests Silver to Reach $52 – $56 by May – June 2011 Posted: 12 Apr 2011 04:41 AM PDT Dollar Inflation remains the driver of the pricing environment for almost everything denominated in U.S. Dollars as long as the Fed continues to monetize debt. The debt monetization creates Dollar Inflation that results in Dollar Devaluation. By the time the Fed has ramped up the QE II that they have announced will end in June, I expect Gold, Silver, and the HUI will have risen to $1860 - $1975, $52 - $56 and 940 - 970 respectively. Let me show you why. Words: 1301 |
| Posted: 12 Apr 2011 03:30 AM PDT In a previous commentary I looked at how our economies would function in a world where our paper, fiat currencies had collapsed. Given the unrepayable debts racked-up by most Western economies, and the out-of-control money-printing by our central banks (sanctioned by our governments), this is not merely a plausible scenario, but as many would argue it is a highly likely outcome. I explained how by merely applying existing laws on "legal tender" currencies and taxation that we should be able to hold gold and silver money to protect ourselves from the collapse in wealth which accompanies the collapse of banker-paper, and be able to spend that money without any adverse taxation consequences. Specifically, there should be no "capital gains" tax on any transactions where we are spending our gold and silver money – irrespective of how much they have appreciated versus the bankers' worthless paper. I titled that piece "The Gold Economy", in deference to the superior status which gold enjoys (today) as "money". However, shortly after that I was enlightened by some historical materials submitted to me by readers. I quickly revised my position on silver versus gold as "money", and now firmly believe that it is silver rather than gold which is the key, monetary currency – at least on the individual level. Certainly when it comes to "backing" an entire economy, gold's superiority remains obvious. In a subsequent commentary, I looked at how an economy would function hypothetically if it fully "monetized" silver as the official currency in circulation. I pointed out an obvious fact which has been completely forgotten by the modern charlatans who call themselves economists: that a "strong" (and appreciating) currency is the hallmark of both a stable and prosperous economy. I illustrated the fraudulent trade arguments used by these academic dolts which they have used to trigger a "race to the bottom": seeing which governments could devalue their (paper) currencies the fastest. I explained how an economy with "sound money" (in the form of silver currency) would quickly rise above the banker-dominated cesspool of fiat, paper currencies. I referred to the (previous) real-life example of the U.S. economy to provide evidence of how a "high wage" economy with a very strong currency would be more prosperous than competing economies with their paper currencies, rather than less so. However, as my "hypothetical" model for such an economy I used Mexico as my example – saluting the ongoing movement in Mexico today to partially re-monetize silver. Many silver investors are now quite familiar with the Mexican silver-sage, Hugo Salinas Price. His one-man "crusade" to have silver coins recirculated in the Mexican economy as a "parallel" (but official) currency in Mexico is elegant in its simplicity. The genius of his proposal was to keep the unit of currency constant (a 1-oz coin), while allowing the nominal quote which assigns these coins their value to float in conjunction with the prevailing "spot" price of silver – subject to some minor, but technical constraints. He also stressed the importance of allowing the government Treasury which mints these coins to incorporate a fair-but-significant seigniorage (or "premium") on the nominal quote it issued on the coins, in order for it to maintain a reasonable profit-margin on this operation for taxpayers and to ensure there was never a monetary incentive to melt-down the coins for their silver. |
| The Dollar Is Not Sick, It's Terminal Posted: 12 Apr 2011 03:20 AM PDT MarketPulse FX submits: By Dean Popplewell This week the dollar has had the classic opportunity to rally aggressively. Global risk appetite has subsided, commodity currencies have fallen and investors were willing to take profit. Instead, we have witnessed only a feeble attempt to rise. The dollar is more than sick, it's terminal. With the Fed expected to now trail all other Cbanks when it comes to tightening, is putting the dollar near the bottom of the G10 carry trade league and up there with the classic funding currencies Complete Story » |
| Interview With a Trading Legend, Part V: The Toughest Trade Posted: 12 Apr 2011 03:11 AM PDT
In Part IV of this series, we learned about protecting profits, staying centered, the characteristics of a big trade, and who a trader's biggest opponent is in markets. In Part V we hear about Peter's experiences as a light aircraft pilot… his most interesting trade… his toughest (most emotional) trade… and key principles to avoid compound errors (making it back from "the wilderness"). This interview series is part of the Mercenary Vault, an archive of exclusive high quality materials available to Mercenary Dispatch subscribers. The Dispatch is our means of direct communication (via email) with Mercenary community members — and it's free! Sign up here and don't miss out on future exclusives. On to Part V… Note: This interview segement is Part V of a series. Also available:
JACK SPARROW: Speaking of "license to fly," you've mentioned that you are a pilot. PETER BRANDT: I've owned three aircraft in my life. I started with a 1951 Piper Tri-Pacer, which was the first Piper that had tricycle gear. It was a fabric aircraft, and had a sink rate of a lead weight, and a high speed for touchdown. It was a lightweight plane, a four-seater, and the thing was just fast. It had a speed of about 135 knots. I bought the Piper with my wife's cousin, who was an Air Force pilot. We both lived in Chicago and he was based out of Michigan, so he needed a plane to fly over to his base. So he said, "Want to learn how to fly? You can buy half of the plane." So I learned how to fly that way. Then I bought a Cessna 172, and then a Cessna 182. I wound up selling the Cessna 182 but I should have kept it. Used aircraft just keep going up in value every year. Flying was expensive, but it was great for me because I wrote most of it off. When I moved my family to northern Minnesota I would fly down to Chicago, and I could land at Miggs Field right in downtown Chicago. I could literally walk to the Board of Trade from Miggs Field. It was a ten-block walk. In Minnesota we lived on a lake, and I had a neighbor with a snowplow. He would plow an airstrip for me on the lake. In the winter time I would take an ice auger and auger down my straps, so I could strap it down and keep the plane right on the ice. I didn't have floats on it, but I had floats on the 172. MIKE McDERMOTT: Can you put floats on it? PETER BRANDT: Oh yes. I wound up selling it in Alaska. It had what is called a STOL kit, which stands for Slow Take-Off and Landing. It gave you an extra curvature off the back of the wing. If it was perfectly still and there was no wind, winter-time, early morning or late evening, no thermals, I would see how slow I could be going at the point of touchdown. I used to do that just for fun. I could get it down to 38 or 39 knots. We would take it out and see if we could land it with just the trim tabs. JACK SPARROW: So did you find any parallels between flying and trading? PETER BRANDT: No, I forgot about trading when I was flying. JACK SPARROW: Just a beautiful escape. PETER BRANDT: A marvelous escape. I clocked a lot of hours, flying just about every day. We lived up in Nisswa, Minnesota, and I had the option of landing on the lake in winter time – which really scared the ice fishermen, because when you landed on the lake the ice would crack. It's thick enough that it was not going to break, but it does crack. And these ice fisherman would get so mad at me. Then we had a grass strip which was five miles away, and a really nice airport with an 8,200 foot main runway that was 25 miles away. I kept the plane in a hangar there. JACK SPARROW: Tell us about the most interesting trade you've ever had. PETER BRANDT: It was 9/11, when the first tower was hit. The futures were operating in one of the buildings within the World Trade complex. After the first tower was hit, the trading was halted and then it briefly reopened, and I traded gold. I have a time-stamped order after the first tower was hit. Just the idea of trading gold, considering what was happening, seems to me a fascinating thing. When gold re-opened six days later I think it was $10 or more higher – which was a big move at the time – and I took my profit and walked away from the trade. I considered myself lucky, and the reason I walked away from the trade is because I didn't like the idea of making money on a lot of people's suffering. I decided I wouldn't sit and exploit the market any further, and I can't even remember what the market did after that. But I remember taking my profit thinking, "I've just made money on the lives of a lot of people. I'll take my profits and I'll thank the market and walk away." So that was probably my most interesting trade ever. JACK SPARROW: What was your toughest trade ever? PETER BRANDT: The toughest trade ever was crude oil. It was the first Iraq war, January 16, 1991 when the bombing started. I was long crude when the bombing started – the evening of January 16 – and I was thinking, "Man, this is going to be sweet." Crude oil was trading a few bucks higher in the after market, but by the time the pit trading started the next day, the trade opened something like 700 points against me. Prices closed on January 16 somewhere in the area of $30 per barrel. Then the war started, and prices opened in the pit on Feb. 17 about 700 points lower. I remember thinking the night the bombing started, "This is going to be payday." Prices were trading that evening on the curb $3 or $4 higher right after the bombing. But by the time U.S. markets opened, crude had in effect declined ten bucks off the previous evening's curb price. JACK SPARROW: Was that your most emotional trade? PETER BRANDT: That was just the hardest trade – my biggest, quickest single loss. I don't think the size was very big, it was just a trade I thought I'd be making four or five thousand dollars per contract on, and I ended up limping out with a six or seven thousand dollar per contract loss. Oftentimes the emotional hit from a trade is tied to an earlier expectation for the trade.
JACK SPARROW: As you said earlier, you know there will be ten great patterns each year and the year after that. Does that help put those kind of setbacks in perspective, or the times when you feel "out in the wilderness?" PETER BRANDT: There are things that stand out as principles I really need to hold to. One of them is that I need to forgive myself very quickly when I do something stupid. I can sit and hold previous mistakes over my head, and mistakes will compound if I do that. You have to be able to clear your conscience of the mistake you just made. If you beat yourself up and hold onto something, you're going to make another error. It is inevitable that one error will lead to another error in this business. So you have to flatten yourself out emotionally. And until you do, you just have to go back to small positions until you can build leverage back up. I've been there before, and I'll be there again. In fact, I am there right now as we are speaking. But you've got to have confidence in yourself, and in what you've done, in order to come out of that wilderness. Otherwise you'll change the way you trade – and then you won't have a clue where you are. Because what if you change the way you trade, and it works for a month or two, but then the new way of trading goes into the wilderness too. What do you do then? The only way for a novice trader to make it as a trader is to make a lot of mistakes, many mistakes more than once, until they figure it out and say, "Okay, this is the way I'm going to trade." And it may not be the way other traders do it. In fact, it really cannot be exactly how another trader trades, although it is certainly possible to admire how other traders do it. I can look at how another trader trades and say, "That's a thing of beauty. That is gorgeous how that guy does it." But it's not the way I do it. You live and die with your own way. That is what every professional trader does. That's what you Mercenary guys do. JACK SPARROW: Right – it's about synthesizing knowledge and great ideas, and then letting your own style emerge. PETER BRANDT: You know, I would love to be your age and know as much as you guys know. The opportunities are going to come your way. You'll just stumble upon them. Like the Commodities Corp opportunity that came to me – I wasn't looking for that when it came. Homestake Mining, I wasn't expecting that… things will just come your way, and I think you'll recognize them. MIKE MCDERMOTT: We've got our eyes open… PETER BRANDT: I was 35 years old when my Swiss Franc trade happened. It all really started for me when I was 35. I think you guys will have an opportunity to manage a billion dollars, if you want to. Or if you want to, keep it at $200 million and have fun and keep it small, without the headache of having to hire an H.R. director. MIKE MCDERMOTT: That will be a fun decision to make! PETER BRANDT: I think it will happen. You'll be able to manage a large sum of money, if that's what you choose to do. You do it smart, you're astute, you have a good approach and good risk management… keep doing those things and you're going to get noticed by people who can write out large checks. To be continued…  |
| iShares Silver Trust ETF Is Good But Try Mining Stocks as Well Posted: 12 Apr 2011 03:09 AM PDT NakedValue submits: The iShares Silver Trust ETF (SLV) is quickly becoming one of the market's hottest ETFs. But investors should know that silver mining stocks are also a good way to bet on the price of silver. While this may seem hardly novel, miners aren't always good substitutes for the assets that they mine. For example, factors like managerial decisions and capital structure issues can seriously distort the relationship between the mined products and the miners. SILVER RETURNS DURING QE2 Here is a graph of the cumulative returns of iShares Silver Trust ETF and silver miner stocks since Ben Bernanke's Jackson Hole speech. Based on the Complete Story » |
| Oracle: The Giant Moves Quietly in M&A Posted: 12 Apr 2011 02:42 AM PDT The 451 Group: Inorganic Growth submits: By Brenon Daly For a giant of a company, Oracle (ORCL) certainly strikes quietly when it moves to pick up some companies. Consider its latest purchase, the as-yet-unannounced acquisition of data-quality vendor Datanomic. Although Oracle hasn't formally announced the purchase, the company does have it listed on its Web page for acquisitions. (That listing followed speculation by several market sources last week that Oracle had indeed sealed the deal.) Oracle has already shown that it is ready to spend to buy in the data-quality market. A little more than a year ago, Oracle reached for Silver Creek Systems, an OEM partner that provided product-oriented data quality. Shortly after that transaction was announced, my colleague Krishna Roy speculated that Datanomic might be the next data-quality-related vendor to get snapped up, highlighting both Oracle and IBM as possible buyers for the UK-based company. We believe that Big Blue did look at Datanomic, Complete Story » |
| Posted: 12 Apr 2011 02:30 AM PDT Latest Week ended. Dow Jones Industrial Average: Closed at 12380.05 -29.44 finishing the week basically flat. Volume was way down at 122 million versus a normal moving average volume of 707 million. This volume drop is a big deal and it either means a very negative open on Monday, or the Plunge Protection Team comes in before that and props the markets to ensure we do not see a rout in stocks next Monday. We have an interesting supportive chart pattern with (1) an inverted head and shoulders pattern, which is bullish. (2) Further, the closing price is above all the moving averages. New support is 12250 on the 20-day average. Resistance is 12,400-12,500 just above the close. (3) We have matched a price double top, which is bearish. It's been hit 5-6 times with no break-through. Momentum is up despite the very low volume. We see more bull signals then bear signals but the volume number is of great concern. We recommend traders tighten stops and do zero trading for at least 30-45 minutes after the open on Monday. This is both very interesting and scary at the same time. If for some reason the selling began next week and it got rough, major support is further below at 11,500 under four, clear support levels. Be careful! S&P 100 Index: Closed at 594.43 -1.77 on normal trading volume and rising momentum. Resistance is 600 and support is 590.31 on the 20-day moving average. To produce an accurate double top, similar to the Dow, the 100 Index should touch 605 and then retreat. With six trading days of channeled prices, the 100 Index might continue to do the same and prolong the selling until later this month. Last year at the end of April, it took a dive from about 525 to low of 460 later on in June. We see no enthusiasm for buying shares by the big funds and others. Rather, the patterns are one of distribution and just hanging around waiting for some good news. Perhaps it's caused by the government shut-down, rising commodities prices and rising interest rates at the ECB. We'll have to see how this plays out but, recommend caution next week until things are more firm with tradable trends. S&P 500 Index: Closed at 1328.17 -5.34 on 81% of normal volume and rising momentum. Like the other index charts, this one has a larger double top structure with 5-6 tries on a breakout but could not get through the topping price. Since the trading was flat and non-aggressive as well as not wanting to sell, we see channeled, sideways trading in chop. Price remains above all moving averages and resistance is 1335 with support at 1318.87 on the 20-day moving average. This index is moved very fast by the biggest money. If the Dow shows some life and PPT support early on Monday, we think the S&P's will be bigger buyers. Smart traders will wait and watch to see trends and purpose before putting new money on the line Monday. Nasdaq 100 Index: Closed at 2321.18 -11.70 on 90% of normal volume with new support on the 20-day average at 2315.78 and resistance at 2350 on a top channel trading range line. If this index were to double top it would have to touch 2400 first and then sell on a pivot reverse. There is a criss-cross trading channel pattern with the price trapped in between. Further, the close is supported by and just above the 20 and 50 day averages. The last four closes have been spreading in the middle of this criss-cross, which we would say was bearish. It could be short term bearish but could just as easily lead the stock indexes in a new selling cycle, which we did forecast was due to begin next Monday. Watch this index as a leading indicator for the broader stock markets and the precious metals shares' markets as well. It looks ominous to us and if we had to bet on the outcome; we would say tighten stops and get ready for some selling. When new selling in shares begins; it begins in the Nasdaq 100 first. XAU Index: Closed at 226.00 +0.00 finishing flat near the opening. There is price resistance at 230 and that number was touched today and immediately reversed lower to sell off. Price closed at the bottom of the bar telling us of a 90% chance to sell on Monday. Yet, momentum remains up and the very important metal to shares ratio has been rising; but went flat on this last trading day of the week. Also, 230 is double top price for the XAU touched in the first week of January earlier this year. Support is 225-216 and resistance is 230. Watch the Nasdaq to see if it sells or buys early on Monday morning. This should give us the signal to exit or stay long on shares. 30-Year Bonds: Closed at 118.53 now supported on a major low number. If the bonds slide under 118.00 next week, we can easily see selling to 115.50 new and lower support. If trading goes there, we are in a new paradigm market. Price is under all moving averages. Price has fallen under a major trading channel support. Momentum has turned down. And worst of all, the price is 4.5 points under the 200-day moving average. Next, Europe raised interest rates by the ECB of 25 basis points this week. Further, Bernanke now has to buy more of his own toxic paper than ever before. Nobody wants his Treasury Bonds' junk paper. There is one last old and lower channel line support at 117.75. If stocks begin to sell, the bonds might recover somewhat moving toward the 118.50-119.50 resistance. Credit quality continues to deteriorate world-wide. Gold: Closed at 1475.30 +47.90 rising in very large buying wave three. Momentum was flat but should catch-up to the rising prices next week. On the weekly chart, we are early and just in the new wave three (the largest) in a rally. However on the daily chart we have about topped out and should consolidate for 2-3 days before resumption of more buying. Support and resistance are both on 1475 with lower support at 1465. Resistance up higher would be 1485, 1492.50, 1495, 1498.50 and then 1507. We are expecting the gold and silver rallies to continue through mid-May with one correction first next week followed by another after May 15th. The gold price of 1507 is major resistance. If we touch and go through that number immediately following the next small correction, it is entirely possible to see gold at 1607 by the end of June. That is our highest gold number for the year. However, if 1607 is achieved, then we have to revise for a new all time 2011 high, probably going to 1707 or, maybe something even slightly higher. This market is a reflection of deterioration in both stocks and bonds world-wide. Silver: Closing at 40.91 +3.14 in one of the largest daily trading ranges we've seen for one session. On the weekly chart we see five price gaps as silver goes almost vertical. With this power in this market, we expect a faster run to $48.50-$51.00 resistance. Then, this could be followed by some hard selling against the old 1980-1981 highs. Momentum is up, and if silver can keep up this pace, we could hit $50 by next weekend. We recommend tightening stops on shares trades and investments. If you are holding large profits on some positions, it might be smart to execute or plan and exit next week. US Dollar: Closed at 74.97 -0.86 selling on falling momentum at an increasing speed. The dollar has fallen under four major supports and all moving averages. The Euro went up and was propped by the new ECB interest rate increase of 25 basis points this week. June dollar index contracts are now a little higher at 75.10; just a tiny recovery move up in after hours trading this Friday. Next lower support is 74.50 with resistance at 75.00. Last year, the dollar tumbled in severe selling near the same dates. It fell from 90.00 to low of 71.00; roughly. We are not sure if the history repeats but with the Euro up and Bernanke's bond auctions going so badly with no new USA budget, things cannot get much worse for the dollar. Expect more selling Monday. Crude Oil: Closed at 113.10 +4.95 in a very large rally for one trading session. Momentum was up gradually, but has turned higher more sharply. After three touches and runs at the top channel trading range line, the price has broken out running right through mild resistance at 110.00. Next resistance is $112.50. After that we could see $116-120 very quickly. Oil's trading pattern was in a long-range bull flag. It began in January of 2009 and has continued steadily higher until the top-line breakout this past week. Normally, oil will pause in Mid-April and still can. However, we see the price touching 112.50 or, slightly higher before a pause correction and some mild selling. More buying next week with most commodities nearing a top. CRB Index: Closed at 368.70 +7.81 on rising but fading momentum with a price firmly positioned above a bull trading channel line. Support is 365 and resistance is 370-365 in the same general price area. We are near the old CRB top of 365 in April, 2006. Most all the grains, base metals, energy and precious metals have been in a bull run of magnitude. Expect an ABC sideways trading pause next week with pressure to the buy side. –Traderrog         This posting includes an audio/video/photo media file: Download Now |
| Currency ETFs and the Carry Trade Posted: 12 Apr 2011 02:18 AM PDT Tom Lydon submits: As the fortunes of world economies rise and fall and central banks decide when to raise interest rates, traders may capitalize on currency movements with exchange traded funds (ETFs). Within the close circle of currency traders, the so-called carry trade is back on. Carry trades are performed by borrowing a low-yield currency and investing in currencies that have higher yields, write Geoffrey Rogow and Rebecca Howard for The Wall Street Journal. Last Thursday, the European Central Bank hiked a key interest rate for the first time since 2008. Consequently, the euro hit a 11-month high against the low-yield yen and U.S. dollar. As currency traders are becoming more comfortable with the Japanese yen's current ceiling, traders are borrowing more of the low-yielding yen and converting it back to the Australian dollar. Kurt Magnus, executive director of FX Sales at Nomura in Sydney, commented that "the yen is being sold in Complete Story » |
| Gold Over £900/oz as British Pound Falls Sharply… Posted: 12 Apr 2011 01:43 AM PDT
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| Nuclear crisis: Japanese gov't raises severity rating to highest possible level Posted: 12 Apr 2011 01:13 AM PDT From Bloomberg: Japan raised the severity rating of its nuclear crisis to the highest, matching the 1986 Chernobyl disaster, after increasing radiation prompted the government to widen the evacuation zone and aftershocks rocked the country. Japan's Nuclear and Industrial Safety Agency today raised the rating to 7. The accident at the Fukushima Dai-Ichi station was previously rated 5 on the global scale, the same as the 1979 partial reactor meltdown at Three Mile Island in Pennsylvania. The stricken nuclear plant, located about 220 kilometers (135 miles) north of Tokyo, is leaking radiation in Japan's worst civilian nuclear disaster after a magnitude-9 quake and tsunami on March 11. Tokyo Electric Power Co. said its plant, which has withstood hundreds of aftershocks, may spew more radiation than Chernobyl before the crisis is contained. "If the leaks continue, the total radiation from the reactors may exceed" that from Chernobyl, Junichi Matsumoto, general manager of one of the utility's nuclear divisions, said in Tokyo today. The disaster at the Chernobyl power plant in modern-day Ukraine spewed debris as high as 9 kilometers into the air and released radiation 200 times the volume of the combined bombings of Hiroshima and Nagasaki in 1945, according to a 2006 report commissioned by Europe's Green Party. The radiation released so far is estimated to be around 10 percent of that from Chernobyl, Japan's nuclear safety agency said earlier in a statement. The situation at the station is "severe but stable," Hidehiko Nishiyama, the agency's deputy director-general, said at a media briefing. 'Will Do Our Best' "We are trying to resolve the situation as soon as possible and will do our best to cool down the reactors and prevent the spread of radioactive substances," Masataka Shimizu, president of the utility, a statement issued after the severity rating was raised. He also apologized for the accident. The company's shares fell 10 percent to close at 450 yen Tokyo. The stock has slumped 79 percent since the crisis began. Prime Minister Naoto Kan said he has asked Tepco, as the utility is called, to give an assessment of when the company expects to resolve the crisis. "An outlook will be presented soon," he said at news conference in Tokyo. Today's rating change won't lead to a widening of the evacuation zone beyond the increase announced yesterday, Kenkichi Hirose, an adviser to Kan's cabinet, said earlier. Chief Cabinet Secretary Yukio Edano said yesterday that residents of some towns beyond the 20-kilometer evacuation zone around the plant will have a month to move to safer areas. Accident Rating Scale "In contrast with Chernobyl, we have been able to avoid direct health risks," Edano said at a public event in Tokyo today. "The assessment level of 7 may be the same, but in terms of its shape and contents, the process has been different." The International Nuclear and Radiological Event Scale rates nuclear accidents in terms of their effects on health and the environment, according to the International Atomic Energy Agency, which helped set up the system. Each of its seven steps represents a ten-fold increase in the severity. A 7 rating means there has been a "major release of radioactive material with widespread health and environmental effects requiring implementation of planned and extended countermeasures," according to the INES factsheet. The assessment is based on the combined severity of the situation at reactor Nos. 1, 2 and 3, Nishiyama of the safety agency said. 'Beginning To Wake Up' The government "is at last beginning to wake up to the reality of the scale of the disaster," said Philip White, International Liaison Officer at the Citizens' Nuclear Information Center, a Tokyo-based group opposed to atomic energy. "Its belated move to evacuate people from a larger area around the nuclear plant, likewise, is a recognition that the impact on public health is potentially much greater than it first acknowledged." The March 11 earthquake, the nation's strongest on record, and tsunami left about 27,500 dead or missing, according to Japan's National Police Agency. Japan was struck by two earthquakes stronger than magnitude 6 today, hindering recovery efforts as workers were temporarily evacuated. The temblors followed a 6.6-magnitude quake yesterday and a magnitude 7.1 aftershock on April 7. While there was no damage to the Fukushima plant from the recent earthquakes, Tepco's Matsumoto said disruptions make it difficult to assess when it will achieve cold shutdown of the three damaged reactors. The station has six reactors. Tepco resumed injecting nitrogen into the No.1 reactor's containment vessel at 11:34 p.m. yesterday after halting it following yesterday's temblor, it said in a statement on its website. The operation, which is aimed at preventing hydrogen explosions, is continuing, spokesman Naoyuki Matsumoto said. Water levels in trenches near reactors Nos. 1, 2 and 3 haven't changed, according to the statement. To contact the reporters on this story: Yuji Okada in Tokyo at yokada6@bloomberg.net; Aaron Sheldrick in Tokyo at asheldrick@bloomberg.net; Michio Nakayama in Tokyo at mnakayama4@bloomberg.net. To contact the editor responsible for this story: Amit Prakash at aprakash1@bloomberg.net. More on the Japanese disaster: Nuclear CRISIS: Plutonium now being detected in Japanese soil U.S. Congressman suggests officials are covering up a Japanese nuclear meltdown Japanese power company manager weeps after revealing the truth about the nuclear disaster |
| The world's top trading firm is calling a top in commodities Posted: 12 Apr 2011 01:06 AM PDT From Pragmatic Capitalism: Goldman Sachs is ringing the bell on its very successful bullish call in four big commodities – copper, crude, cotton, and platinum. The trade basket, known as their CCCP basket, was first recommended in December 2010. They cite a changing risk/reward for the change in position. Did Goldman Sachs just fire the first shots in the end of the QE2 trade?: Risk-reward no longer favors being long CCCP Although we believe that on a 12-month horizon the CCCP basket still has upside potential, in the near term risk-reward no longer favors being long the basket and we are recommending closing the position for... Read full article... More on commodities: Jim Rogers: Don't buy gold now Marc Faber: Sell stocks now... buy this instead Forget gold... One of America's favorite commodities is headed to all-time highs |
| Why high oil prices could be here to stay this time Posted: 12 Apr 2011 01:02 AM PDT From Frank Holmes of U.S. Global Investors: A number of forces continued to push oil prices higher last week, reaching their highest levels in the U.S. since September 2008. One factor fueling the run has been the continued decline of the U.S. dollar. You can see from the chart that oil and the dollar historically are negatively correlated. This means that a rise in oil prices generally coincides with a decline in the dollar, and vice versa. The U.S. dollar has seen a dramatic decline since the beginning of the year as oil prices have moved some 30% higher. This could be due to fact that roughly two-thirds of the U.S. trade deficit is related to oil imports. Despite the run-up, oil's upward rate of change is still within its normal trading pattern over the past 60 trading days. Accordingly, this may imply that it isn't a spike and we haven't crossed into the extreme territory like we experienced in 2008 and 2009. Conversely, oil prices are... Read full article... More on energy: Five stocks to profit from a boom in natural gas Why oil prices could plunge 15% in the next 30 days This beaten-down commodity is now the No. 1 "safe energy bet" |
| Mining stocks vs. Physical gold and silver Posted: 12 Apr 2011 12:58 AM PDT |
| Gold & Silver Slip as Goldman Says "Sell Commodities", Interest-Rate Hikes "Further Delayed" Posted: 12 Apr 2011 12:53 AM PDT |
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| Why a $1m short-option against July silver is not so crazy Posted: 12 Apr 2011 12:15 AM PDT The silver price dropped back below $40-an-ounce as news of a $1 million short-option just written against silver delivered in July circulated through the trading pits yesterday. Silver bugs will not like this but there is logic here. If the stock market pops, and the rally looks on its last legs as profits expectations are now too high and QE2 is about to end, then commodity prices will be dragged down too. |
| Gold and Silvers Daily Review for April 10th, 2011 Posted: 12 Apr 2011 12:11 AM PDT
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| Ebay / paypal and tax reporting Posted: 12 Apr 2011 12:10 AM PDT Does ebay / paypal send out tax forms for sales over a certain $$ amount? |
| Buy Pullbacks in Gold & Ignore the Top Callers: Richard Russell Posted: 11 Apr 2011 08:47 PM PDT  And this just in from Eric King as I was about to hit the send button. It's a Richard Russell blog posted over at King World News...and the title says it all. I haven't even read it yet, but I know for sure it's a must read for all you nervous Nellie newbies out there. The link is here. |
| Alasdair Macleod: Interest rates and Plan B Posted: 11 Apr 2011 08:47 PM PDT  Here's another story I'm borrowing from a GATA release that came out yesterday. A small increase in U.S. interest rates could provide cover for more bond monetization by the Federal Reserve, economist and former banker Alasdair Macleod writes in his latest commentary. Along the way Macleod adds: "The Fed and the Band of England are having their hands forced by the unstoppable rise in gold and silver prices. This is a suppression scheme the central banks have finally and demonstrably lost, and in doing so the mounting costs of the short positions on Comex and in the unallocated accounts of LBMA members have become a serious systemic risk." |
| Who Are the Real Victims of a U.S. Dollar Crash? Posted: 11 Apr 2011 06:42 PM PDT
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| Analysts warn of silver sector overheating Posted: 11 Apr 2011 06:31 PM PDT |
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