"When misguided public opinion honors what is despicable and despises what is honorable, punishes virtue and rewards vice, encourages what is harmful and discourages what is useful, applauds falsehood and smothers truth under indifference or insult, a nation turns its back on progress and can be restored only by the terrible lessons of catastrophe." … Frederic Bastiat

Evil talks about tolerance only when it’s weak. When it gains the upper hand, its vanity always requires the destruction of the good and the innocent, because the example of good and innocent lives is an ongoing witness against it. So it always has been. So it always will be. And America has no special immunity to becoming an enemy of its own founding beliefs about human freedom, human dignity, the limited power of the state, and the sovereignty of God. – Archbishop Chaput


Thursday, March 15, 2012

Gold holding near $1640

The Yellow Metal attracted some short covering and some buying related to bargain hunting in today's session as apparently buying was of sufficient size to convince some of the shorts that the market was through going down for right now. After a drop of $85 in a few days, some decided that it was time to ring the cash register and grab a few profits.

It looks like a few light stops were run once the market took out $1660 but after those were filled, price retreated a bit lower and is currently below that level.

For me to become convinced that a short term bottom is in this market, we will need to see the price close back through the $1680 level once again. You might remember from yesterday's charts posted over at King World News within my recent interview, the 200 day moving average comes in very near that level.

For the time being I am hesitant to read too much into a single day's action.

The Dollar is moving lower today and I want to see whether or not this is a one day wonder or if it is going to try to mount a push back towards 82 on the USDX.

The S&P 500 continues on its near one-way trek higher scoring another fresh 52 week high in the process. I do not know about you, but I for one am glad that it was so easy to fix everything ailing the US economy by keeping interest rates near zero. I am waiting for the day when the Fed announces it is going to distribute checks to all taxpaying citizens in the amount of $10,000 each as part of its efforts to combat deflationary pressures.

The HUI continues getting beaten up as it is lower on the day even while the rest of the equity market leaves it in the dust. The sector is so undervalued against the broader market that it screams for someone to buy it but the discouragement is so strong that hardly any want to touch the miners for fear of further losses. The ratio of the HUI to the S&P 500 touched a nearly three year low today!





    Germany’s DAX: +20%, 96% annualized
    S&P 500: +11%, 52% annualized
    S&P 500: up 67% of all sessions, just one -1% day in 51 trading sessions.
    Nasdaq 100: +19%, 91% annualized, up 73% of all sessions.
    Homebuilders Index: +23%, 110% annualized
    S&P Financials: +21%, 100% annualized
    Apple, the world’s largest company: +45%, 216% annualized

    In-Place Oil Shale Resources Underlying Federal Lands in the Green River and Washakie Basins, Southwestern Wyoming



  2. Hi Dan, I checked bullioin coins on ebay yesterday out of curiosity :

    Silver eagles closing at $38...mint tube (20 coins) $760 dollars or $38 / coin.

    Gold eagles $1800

    Gold Maples $1785

    Most of this did ot even include shipping charges. I guess volatility increase premiums? Perhaps you could cover this with Eric on your metals wrap this weekend?

    I would be particularly interested in your (and Jim's) perspective on when we might see a decoupling of the manipulated paper price versus the real physical price. I realize the products above are premuim minted products valued the word over; however, I can also see the central planners efforts backfiring on them one of these times in their psychopatic obsession with profit and maintaining control at all costs.
    I know a comex default woul eventually cause this, but it their a price level in your mind that may be the ultimate impetus for such an event? I know this is somewhat complex and theoretical, but wouldn't the mining producers then be forced to come up with their own fair market to get product to their customers for ddelivery at any price...just my thoughts..because I know market maninpulation will end badly for the manipulators. (sorry for all of the typos...an iPad is terrible for a blog...guess I should short APPL for that ...it will not allow me to back up and edit..oh well). Have a restful and safe weekend everyone.

  3. Great analysis as usual Dan. Thanks for all you do.

  4. Keep on keeping on. I am listening to Jim Sinclair’s latest KWN interview – THANK YOU!
    Imagine if we were living this period in solitary confinement. If enough people squawk eventually something will get done – Mr Market always wins in the end. And in terms of people coming together, nothing brings people together like adversity – unjust adversity even more so. If the banks are going to “close ranks” to prevent “whistleblowers” – so be it. “You made your bed – now lie in it”.
    Certain principles of being a Just Person – or Society – do not allow you treat others with contempt. I also read the Daily Reckoning today. I liked the way Eric Fry started his piece about Mr Smith, “Today’s reading comes from the book of Greg Smith”. Effectively we all hope to find our names in the book – Revelations – when our day has come. So until that time what does the Church have to say to us today? Mark 12 28b – 34 (in my own words) someone asked Jesus what is the first of all the commandments? Jesus replies “Here’s the first: Listen Israel, the Lord our saviour is ONE and the unique God. [Dt 6,4 Shema Israel …] The second: Love your neighbour like you love yourself …”
    Effectively when you love yourself you can accept making a sacrifice – like ruining your career - because you can no longer accept where you are being forced to go. One of my heroes, Sir Thomas More, was just like that – he truly was made “of the right stuff”.


    As we know $1,640 is Jim Sinclair's target number for the gold breakout. I will be extremely interested in what Jim Sinclair has to say about this recent global concern about FRACTIONAL RESERVE GOLD mentioned by Bill Haines on the current KWN WEEKLY METALS WRAP.

    As Obama likes to say: "This is unprecedented!..."

    Fractional reserve GOLD raises immediate global concern


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