Timberline Resources Corp. [OTC-BB: TBLC] Upside Through Discovery • Record Revenues - Drilling Services

The Markets:

Charts Courtesy of http://finance.yahoo.com/

Oil rebounded from this week’s significant losses as some cold weather forecasts and rumors of an emergency OPEC meeting to cut production encouraged some buying ahead of the long weekend.

The U.S. dollar index fell as world central banks bought euros and traders sold the dollar on the view that this week’s rally was overdone.

Treasuries fell on better than expected economic data that pushed interest rates higher.

The Dow, Nasdaq, and S&P saw losses in early trade on profit warnings and interest rate worries, but all three indices climbed higher in afternoon trade and ended with decent gains on economic optimism.

Among the big names making news in the market Friday were AMD, Cablevision, GE, and Wachovia.

The Commentary:

“February Gold finished up 13 at 626.9, 1.9 off the high and 14.6 up from the low.

March Silver closed up 0.42 at 12.88. This was 0.44 up from the low and 0.06 off the high.

With the gold market seeing a reversal in the Dollar and a bounce in oil prices it wasn't surprising to see gold manage such an impressive run up. However, the magnitude of the gains posted Friday, were significant enough to assume that something other than a simple outside market reaction. In fact, with the grain markets exploding one might come to the conclusion that part of the buying on Friday was in some way inflation or flight to quality orientated. It is also possible that the favorable US retail sales reading prompted buying, especially since the Dollar failed to rally in the wake of that news. The Russia Central Bank expects gold and foreign currency reserves to grow by $70 to $80 billion this year and that might have prompted some players to anticipate an upcoming increase in Russian gold holdings. With the rally in oil prices and the decline in the Dollar some players are wondering if the broad based commodity liquidation wave has run its course.

With a massive upward extension the March silver contract exploded away from the 200 day moving average and in the process might have prompted technical short covering and fresh buying. Surprisingly a sharp slide in copper prices didn't discourage the silver market from making a big upward thrust and that would seem to suggest that investment demand expectations were playing a bigger role in the rally than physical demand expectations. In the end, the silver market rallied this week despite unfavorable US Dollar action, unfavorable Copper market action and despite evidence of rising production! As in the gold market, the silver market seems to have gotten beyond the broad based selling pattern and might be in line for renewed fund buying interest.”- The Hightower Report, Futures Analysis and Forecasting

GATA Posts:

Ron Paul to seek Republican presidential nomination

Western Australia's GATA sympathizers meet for lunch Jan. 22 in Perth

Gulf Arabs reconsider their currency pegs to dollar

The Statistics:

As of close of business: 1/11/2007

Global Gold ETF Holdings

[WGC Sponsored ETF’s]

 Note: change in Total Tonnes from yesterday’s data:  The ASX added 0.1 tonnes.

COMEX Gold Trust (IAU)

 Note: No change in Total Tonnes from yesterday’s data.

Silver Trust (SLV)