Commodities, including Precious Metals Down

This is the DJI graph as of today at the close. Notice that the DOW has now made five attempts to break through its 40 Day Moving Average; as follows: About December 1st; near Christmas, around February 1st; near March 1st (did not quite reach the average, but tried, and yesterday. From a technical perspective, that is bearish. Note that it closed today below the Average.

The Dow Transportations, on the other hand have spent most of the same time above their 40-Day Moving Average except for late November through about December 15th. and the bad time early January to about the 25th. The Transportations have attacked the 200-Day Moving Average three times and now look like they are trying to better it again now. This is certainly more bullish than the DJI from a technical perspective.

And Richard Russel continues to look for confirmation of either the bear market which was signaled in November, but never confirmed by the Transportations. This non-confirmation is encouraging.
Gold has definitely taken a big hit over the last two days. It closed today at 942.90 down 38.40 and silver followed suit with a close of 18.35 down 1.32. This is not good news for those of us holding the precious metals. The big question, "Is this simply another correction after too rapid a surge up the price ladder over the last two weeks, or is it an end to precious metals bull market?" Let's look at the chart, above, on GLD: the ETF for gold bullion.

GLD has stayed well above its 40-Day Moving Average since at least the first trading day of December. It is still there. The hit of the last two days has it reaching downward for this average. Were it to cross it, that would tend to be bearish. If it holds above the average, that would remain bullish.

Intervention into the markets by the central banks causes volatility giving us wild up and down days which try the strongest of us. We have yet to experience the all out gold rush to precious metals and mining stocks as we had in late 1979 and the first of 1980. Gold adjusted for the inflation of the dollar over that period of time calls for a price above $2,500 per ounce. This would seem to give some encouragement that higher prices are on the horizon. I believe we will see them this year. Therefore, I am holding firm and hanging on tightly to weather this correction and consolidation period.

Buying, if any will be very selective and in very small increments. Hopefully, we will see the bottom of this move very soon.

Rest in the Lord and trust in Him.

Best to each, Doug