Bullish and Bearish Signs for Gold, Silver and Precious Metals

Well, I'm certainly not a general equity bull and hence am not surprised at the recent (ongoing?) global equity market drop. I did also forecast a certain amount of weakness for metals, commodities and precious metals shares. So anyone following my posting got several warnings.

However, when I examine the gold, silver, precious metals stocks and various ratio charts the picture is mixed.

Some bearish signs: major miners (which are heavily weighted into gold mining indices) Barrick Gold (ABX), Newmont Mining (NEM), Goldcorp (GG) are making new lows for 2007 and the charts look like they can slide lower. XGD the Canadian gold miners ETF, $XAU – both closed at a new low for 2007

Some bullish signs: The gold & silver charts do not look that bad (yet), the HUI continue to outperform the heavy hedged XAU. Some juniors are outperforming as Stacy M. Himes posted.

I favor holding good long term gold, silver and precious metals shares positions, be in a wait and see position, do not capitulate, do not sit and wait like a duck for your stops to be taken and don't be shy to take partial profits. If you can't stand the volatility then decrease your positions.

Comments

[Malkiel:]

The recent market drop, with highly-leveraged gold surrogates dragging down the price instead of serving as the bulwark against hardship, has wiped out the gold myth. Gold pricing going forward can only be reliably tied to the jewelry trade, not the kind of business I would want to stake most of my capital on. The news indicated that a few exchanges in India and China would start offering gold-based ETF-type funds next month, which should give the price boost needed to get you out of your position. If you keep large positions after that, better hope jewelry doesn't lose its luster in the industrial future...

2007 Mar 14 09:59 AM

[mikethehond...:]

check out what this oscar guy has to say about Gold www.youtube.com/future...

2007 Mar 14 12:58 PM