-- Posted Tuesday, 16 June 2009 | Digg This Article
| | Source: GoldSeek.com
Rick’s Picks
Tuesday, June 16, 2009
“Phenomenally accurate forecasts”
Unh hee-yah! Unh hee-yah! Unh hee-yah! Gold futures have been pumping iron for more than a year -- and so much the better for all of us if they weren’t up to demolishing the $1000 barrier a couple of weeks ago after getting as close as $992 per ounce. We should regard bullion’s tedious ups and downs over the last eighteen months as quiet preparation for an explosive show of strength. When it finally happens, detonation will be so powerful as to leave doubters in despair after they realize gold is trading $300 higher and they are not on board.
In the meantime, those who have been accumulating coins, ingots and gold shares can relax, since whatever disasters may have befallen nearly every other class of investable assets since 2006, the damage did not even touch gold. To the contrary, the metal has been a solid winner during that time, regardless of the state of the economy and the financial system, and despite mounting fears of inflation, hyperinflation, or deflation.
13 Barrels Per Ounce
Even crude oil at a current $70 a barrel has lagged gold by a wide margin, as the chart above shows. You could have bought six barrels of oil with an ounce of gold when both were topping out last July; now, with gold trading well off its highs, you can buy 13 barrels. We think that ratio will triple, at least, before gold has fully discounted the ongoing destruction of the dollar.
Meanwhile, even though Comex Gold has dropped $65 since early June, the technical picture looks untroubled. We’d projected a drop in the August contract to 925.50 per ounce to begin with, and yesterday that target was very nearly reached on a low of 926.50. We were buyers there, but we’d buy even more if our target gives way and August Gold eases down to the next “Hidden Pivot,” $918. Bullion bears, take note: Comex futures would need to drop a further 13 percent, exceeding $810 an ounce to the downside, to cause even minor damage to the bullish case on the long-term charts.
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Rick's Picks publishes a daily trading newsletter for gold, stock, commodity, and mini-index traders 240 times per year. Information and commentary contained herein comes from sources believed to be reliable, but this cannot be guaranteed. Past performance should not be construed as an indicator of future results, so let the buyer beware. Rick's Picks does not provide investment advice to individuals, nor act as an investment advisor, nor individually advocate the purchase or sale of any security or investment. From time to time, its editor may hold positions in issues referred to in this service, and he may alter or augment them at any time. Investments recommended herein should be made only after consulting with your investment advisor, and only after reviewing the prospectus or financial statements of the company. Rick's Picks reserves the right to use e-mail endorsements and/or profit claims from its subscribers for marketing purposes. All names will be kept anonymous and only subscribers' initials will be used unless express written permission has been granted to the contrary. All Contents © 2009, Rick Ackerman. All Rights Reserved. www.rickackerman.com
-- Posted Tuesday, 16 June 2009 | Digg This Article | Source: GoldSeek.com
