GOOG is now down more than $100 from the stock's high. It has broken down. Perhaps the stock is destined to go to its intrinsic value. A painful experience is developing for the technology loving, fund managers. Sympathy, if that is what they desire, can be found in the dictionary.

Basic Trend: $Gold Up. Investors should focus on Buy signals. Strategy: Positive, per Investment Policy of Oct 2004. Investment Policy: Looking for buy signals, and holding long-term core position.

The Gold and Silver markets almost created some excitement this week. With the metals breaking down, they were moving toward over sold in the short-term. In fact, we were checking our schedule to insure availability if we needed to send out a short-term buy signal. Then, the story of a nerve agent in Washington circulated through the markets. That sent the markets up sharply from near over sold short-term conditions. After a reality check, the markets then withered.

Both markets are dominated by fund trading at this point, and they are a fickle, momentum driven lot. They should be expected to reduce positions this coming week. On the intermediate chart are drawn the various levels of resistance that may become popular. $Gold could drop to that resistance level at about US$480. A buying opportunity should develop at that time. Importantly, do not become overly concerned with correction. It will come, run its course, and set the stage for the next run. However, that process could take some time.

Basic Trend: $Silver: Up Investors should focus on Buy signals. Strategy: Positive, Per Investment Policy of October 2004 Investment Policy: Emphasize Buys

Silver had all the makings of a buy signal when it dipped below $9.28 on Wednesday. The nerve agent scare caused a rally, and the opportunity disappeared. Another will occur. The bigger question deals with the possibility of multiple short-term buy signals before the final bottom. Silver could break as low $8.25 without concern.

$Gold & $Silver Recommendations: Hold existing Gold and Silver positions for higher prices, and further profits! Note that a positive announcement on Silver ETF would send Silver dramatically higher and that possibility is not included in above comments.

TRADING THOUGHTS is published 45 times per year, and distributed by e-mail. Email subscribers to THE VALUE VIEW GOLD REPORT receive TRADING THOUGHTS as part of a $99 e-mail package subscription to THE VALUE VIEW GOLD REPORT. TRADING THOUGHT is not available by regular mail. To receive TRADING THOUGHTS along with THE VALUE VIEW GOLD REPORT click on link below or send your check or credit card information to: Schmidt Management Company, PO Box 846, Boca Raton FL 33429. Fax orders can be sent to 215-243-7161. Our phone number to place an order is 561-447-0874. Under no circumstance will subscriptions be cancelled or refunds issued after the receipt of your first issue.

To join in on the Gold Super Cycle to over $1,300, click on this link:

http://home.att.net/~nwschmidt/Order_Gold_EMonthlyTT.html

CN$Gold:

The break down in CN$Gold is readily apparent in the graph. How low might CN$Gold drop? A move to CN$580 looks increasingly likely. CN$ denominated investors should be building cash for the coming opportunities to buy Gold. The CN$ has been aided by the world wide boom in commodity prices. Do not let that make you complacent. Selling the CN$ whenever strong continues to be sound investment strategy.

CN$Gold Recommendation: CN$ investors should be holding Gold. Accumulate cash for next buy signal. CN$ long-term sell.

EU€Gold:

EU€Gold is likely to weaken further. U.S. dollar is somewhat over sold and $Gold does seem likely to head down. EU buyers should be looking for prices below €420 before becoming active. Careful buying for EU investors is important.

EU€Gold Recommendation: EU€ investors can hold Gold for long-term. EU€ likely to appreciate against US$.

TRADING THOUGHTS is published 45 times per year, and distributed by e-mail. Email subscribers to THE VALUE VIEW GOLD REPORT receive TRADING THOUGHTS as part of a $99 e-mail package subscription to THE VALUE VIEW GOLD REPORT. TRADING THOUGHT is not available by regular mail. To receive TRADING THOUGHTS along with THE VALUE VIEW GOLD REPORT click on link below or send your check or credit card information to: Schmidt Management Company, PO Box 846, Boca Raton FL 33429. Fax orders can be sent to 215-243-7161. Our phone number to place an order is 561-447-0874. Under no circumstance will subscriptions be cancelled or refunds issued after the receipt of your first issue.

For the latest in economic news and evaluation, click on this link:

http://www.gillespieresearch.com

AMEX GOLD MINERS INDEX (GDM) = 971.65

-64.37, or - 6.2%

GDM is showing more weakness than either of the metals. Friday it went out down, and short-term over sold as shown in the chart to the right. Repeated rallies off short-term over sold conditions are likely to develop.

The weakness in this measure contributes to our expectation that Gold and Silver may have further consolidation to experience. As mentioned in the previous paragraph, repeated short-term buy signals are likely. The intermediate indicator, in the bottom graph, is a long way from a buy signal.

Next signal on the intermediate indicator could be at an index level 10% or more lower. For individual stocks, that means price risk of a greater amount. Perhaps a time for researching ideas rather than buying.

Your Eternal Optimist;

Ned W. Schmidt, CFA,CEBS

Click to email me: nwschmidt@earthlink.net

TRADING THOUGHTS is published 45 times per year, and distributed by e-mail. Email subscribers to THE VALUE VIEW GOLD REPORT receive TRADING THOUGHTS as part of a $99 e-mail package subscription to THE VALUE VIEW GOLD REPORT. TRADING THOUGHT is not available by regular mail. To receive TRADING THOUGHTS along with THE VALUE VIEW GOLD REPORT click on link below or send your check or credit card information to: Schmidt Management Company, PO Box 846, Boca Raton FL 33429. Fax orders can be sent to 215-243-7161. Our phone number to place an order is 561-447-0874. Under no circumstance will subscriptions be cancelled or refunds issued after the receipt of your first issue.

-- Posted Sunday, 12 February 2006 | Digg This Article