|
-- Posted Wednesday, 26 February 2003 | Digg This Article
April Gold: Close = $354.1, +$1.7
There were too many hurdles for the bears to overcome, therefore gold nudged higher. The move was not large, but was in synch with how intermarket relationships function. In other words, stocks began to sink, the dollar weakened further, energies rallied (crude up 160 points!), a war is nearing…and therefore gold held its ground.
The Dow bears are drooling at the prospect of slicing through the nearby low of 7600, and with consumer confidence at a 10-year low, they are getting plenty of help from the mainstream. To most people, stocks right now are about as attractive as the plague! Money appears to be running from equity funds, so the question is…where will it be going next, into gold? Surely gold has benefited from poor equity performance, and the proof is in the $120 gold rally. The trend remains up, and there’s no reason why we can’t be near $400 shortly. Blair is taking lots of heat on his stance regarding Iraq, as much if not more than Bush. After all, he’s across the pond where the anti-Bush sentiment is markedly stronger. Rather interviewed Saddam but certainly Saddam didn’t show his hand, but it probably still makes for compelling entertainment. A second U.N. resolution to disarm Iraq is up for a vote soon, and the timetable for ousting Saddam seems to be weeks away. France, Germany and Russia still remain in dissent with the U.N., and this is even causing discord on the European continent. I read that a Danish restaurant has banned French and German tourists. Now THAT is taking a stand! As U.K. Prime Minister Blair has said, it is absurd to continue with weapons inspections as the inspectors are not detectives or on a treasure hunt. The burden is upon Iraq to prove it has destroyed its WMD, but Iraq seems to be blowing its last shot at a diplomatic solution. As we near the breaking point over Iraq, gold prices are more inclined to remain buoyant. It’s difficult to see an overwhelming number of gold shorts establishing themselves under this context. We have mentioned energy prices over the last week, did you see them today…wow! Crude is near $38, the highest level it has seen since 1990 before the Gulf War! Today the US said there were no plans to dip into the Strategic Petroleum Reserves, in spite of the fact that Venezuela remains off line, and in spite of the fact that any war is bound to disrupt supplies even further. With the economy and stocks struggling, with higher energy prices bound to strangle growth, where are investors to put their funds? Will a lack of attractive options attract investors to gold by default? The gold chart appears indifferent with prices in the midst of moving averages, but the trend for the year is still higher. The pullback to the $345 area from the $380 area seems to have been healthy for gold bulls. A close over $360 on consecutive sessions is likely to target $400. Support is the recent low near $343. Meanwhile, hang onto those gold puts as a hedge to the long futures. Be sure to watch TradeScope daily, and remember, futures and options offer flexibility as one can just as easily be short or long any market. Each contract/option = 100 ounces, a $1 move in a futures contract = $100. Contact me anytime to discuss strategies to fit your needs.
To open an account and receive trading recommendations on gold futures or options contracts (also stock indices, energies, currencies, etc.), or to use PaperTrader Online contact me at erik@altavest.com. Visit www.altavest.com to request a Free Starter Kit. Keep in mind that there is risk of loss in all trading.
May Silver: Close = $466.9, +1.3-cents
It’s too bad there isn’t much more to silver’s story, but with few fresh internal fundamentals surfacing silver is finding direction from gold. The gold dip we expected last week was deeper than we thought, but now that gold seems to have stabilized silver too appears to be attracting new buyers. Indicators such as slow stochastics have turned higher. On a close above 475 look for new highs as it’s doubtful bears can keep a lid on prices. Each contract/option = 5,000 ounces, a 1-cent move in a futures contract = $50. Contact me anytime to discuss strategies to fit your needs.
To open an account and receive trading recommendations on silver futures or options contracts (also stock indices, energies, currencies, etc.), or to use PaperTrader Online contact me at erik@altavest.com. Visit www.altavest.com to request a Free Starter Kit. Keep in mind that there is risk of loss in all trading.
-- Posted Wednesday, 26 February 2003 | Digg This Article
Previous Articles by Altavest Worldwide Trading, Inc.
|
