The Big Kahuna?

Jim Sinclair said, "The question you have is simple: Is this the BIG ONE? The answer is YES! It is so reminiscent of the move from $400 to $887.50 in the 70s that this must be the Big Kahuna of $400 to $1650 in the “Gold Bull Market of the Millennium.”"

The upward moves in the price of gold have gone ballistic. They are moving exponentially. From About March 22 to April 13, gold moved from $550 to $600 in the 22 days. Then from April 13 to May 9, gold moved from $600 to $700 in the 26 days. This shows a significant and rapid increase in upward momentum.

The substantial moves have been credited to the Iranian nuclear situation with the growing tensions between the US and Iran, and even with Europe. It may have also received a push with China'announcementet of a move to purchase more gold for reserves. China has also declared a program to increase strategic reserves of most needed minerals and oil.

I doubt that there will be substantial corrections in the price of gold along the way. However, I would certainly consider any as buying opportunities. By the way, there are rumors (I emphasize "RUMORS") that the ETFs on precious metals are not fully backing their shares with gold. Such has happened before.

For me, I will be adding to my stock of metals and mining stocks along the way. There will be a time to sell the stocks, but it is not now in my opinion. At times, it will take courage to resist the temptation to sell.

Timing is the critical part of investing into which we have very limited insight. Technical analysis always tells us that trends continue until they end. Emphasis is given to the movement of price and the volume of sales. Sage advise is do not fight the trend, but attempt to follow along with it.

For the last 24 hours, gold hit a high of $704.40 at 10:02 (NY) this morning and a low of $690.60 at the same time yesterday. It is now at $698.90. Silver is at $14.72.

Most mining stocks are off a bit today from yesterday's close. For example, DROOY is down 3 cents to 1.56; CDY is off 4 cents to 3.15SSRIRE is off 12 cents to 23.83. However, the prices are up from the recent lows.

We will see if this is really the Big Kahuna over time. Timing is always in the hands of our Sovereign God. Of course, He is in control and laughs in derision at the folly of man. A major folly is the Federal Reserve Notes which we use as money. This is a violation of scriptural law which thoroughly condemns the use of unequal weights. These notes are out and out fraud! That is why they are losing value as the Fed attempts to exercise control. The dollar will decrease in value as the supply increases and then accelerates as foreign banks slow or stop supporting our debt. Then, the Lord will really laugh. But He is giving you this forewarning.

Best to each, Doug