We exited copper (JJC: 46.31 0.00 0.00%) and the (SLV: 17.08 0.00 0.00%) in RCE, and some recent silver plays in RGS as well , and it all boils down to this chart …
As I’ve been saying for a couple weeks now, the U.S. dollar index has been showing a disconnect between price action and technical indicators. The anti-dollar trade got crowded, so we’re seeing a correction. If the U.S. dollar index can rally above its 50-day moving average, it could go to 78 or 80 — quite a move.
That’s a big “if”. And the longer-term outlook is terrible for the dollar and good for precious metals, so you can hold positions with an eye on the longer term.
Some stories of interest …
China to Become World’s #1 Gold Consumer: GFMS China looks set to overtake India as the world’s largest gold consumer in 2009, with total demand for jewellery and investment forecast at 432 metric tonnes. GFMS forecasts total gold demand from China in 2009 to be 432 tonnes, compared with that of 422 tonnes from India. China’s investment demand alone was forecast at 83 tonnes, exceeding India’s 53 tonnes.
Goldman Revises up Copper, Aluminum, Gold Forecasts. Given the anticipated strong pick-up in the global economy in the first half of 2010 and correspondingly more buoyant investor sentiment, we expect base metals to make new highs by the middle of next year, Goldman Sachs said in a note.
Speaking of Goldman Sachs, here’s an excerpt from my UncommonWisdomDaily.com column for today …
Wrestling a Vampire Squid in Oil It’s not just Goldman Sachs — there are multiple vampire squids who can manipulate the markets; they have very deep pockets. When it comes down to it, I’d rather not wrestle a vampire squid at all. I’d rather be the guy sitting on the dock drinking a beer, cheering on some other poor sap who is splashing around and wrestling the squid: “Dude, you’ve totally got him! Keep at it! You’re doing great!” But sometimes you get to sit on the dock, and sometimes it’s your fate to wrestle the squid.
Peter Buckton at the blog “Recision” takes my piece on jobs not coming back from yesterday and runs with it for a great commentary: http://recision.wordpress.com/2009/12/04/that-giant-sucking-sound
Thought for the day: CNBC’s Steve Leisman needs no defense from me. But how does he stand being on TV with idiots who talk over him about subjects on which they are proudly ignorant?
Related Posts
- Silver Transcript — Gold and Silver News — More! (12/01/09)
- Buy Gold or Silver? (11/17/09)
- 2 Charts and News on Gold and Silver (10/22/09)
- Will China Ban Exports of Gold and Silver? (09/17/09)
- Silver, Platinum and Gold (01/25/10)
{ 7 comments… read them below or add one }
I have been following the Uncommon Wisdom group these last few months, particularly those following commodities (in most particularly, those following gold). All signs, it seems, point to $2500 per ounce or higher. Additionally, Mr. Edelson and Mr. Weiss, if I recall correctly, were very bearish on the dollar, recommending a short position through UDN. However, Mr. Brodrick appears to contradict all of that with the above. Am I reading this incorrectly, interpreting it incorrectly, or in some other way getting this wrong?
Hi Sean,
Thanks for the link to my commentary - That Giant sucking sound.
Much appreciated, and I always enjoy reading your writing too.
(gotta love a mutual appreciation society huh? Haha
Cheers Peter
In my analysis, the dollar index has risen up to a major resistance level, with more resistance nearby overhead. Details: http://chart.ly/ckm6pd. I bought some UDN calls and some gold miner shares (including XRA from the Weiss seminar) “on the dip”.
–joe
Hi Sean, great work as usual….Thank you for your tireless work.
Anyway, there’s a lot of speculation on the net that the Fed may raise interest rates in June-2010…..
Huh? I have no idea….Does Weiss Research or you have any idea about it????
I recall reading columns by Weiss researchers that interest rates will remain low for a long time. Also, several fed people openly said so in public recently……
I’m kind of confused….That could be dangerous when unemployment is still high.
Please help me. ……hero
What about your rumor of a week or so back regarding shortages of gold in the GLD account??
what about your comment of a week or so back about shortages of actual gold in the GLD accounts?
We have seen 2 Fridays consecutively of major sell-offs in gold. Now, what do you see the trend of gold as on end of December 2009? Please advise. Thanks.