Correction? Buying Opportunity? - Our Confidence!

Here are our miners holding pretty firmly to most of the gains. Gold is 992.90 and silver 16.43 with both on up ticks.

The 24 hour gold graph shows a pattern for today in green which is beginning to look very similar to that of yesterday in red. Our question of the moment is whether the immediate down turn will continue as it did yesterday. Will we see lower prices ahead?

Our proxy for Gld is looking a bit overbought. The breakout is indicated with a red arrow. Look at the purple lines which show a potential head and shoulders top. Technically this looks like correction time. The RSI is still indicating strength as it the MACD. However, the MACD may be topping out. The market will tell us, but it is a time for caution.


From Casey Research Ed Steer's Gold and Silver Daily:

"I have nothing to add to what I said yesterday. The bullion banks continue to run their gold short position into the stratosphere. There are only two ways out... they instigate a sell-off and then pull their bids and the price crashes and burns until the specs longs are forced to puke up their positions so the bullion banks can cover. Or the bullion banks get blown out of the water with a full short position on. It's only the timing for either eventuality that's unknown."

The short position by the boyz is at an all time high. I believe that they will drop the price of gold again just to bail out of the shorts. This is the game they play. It will be a great day if they eventually get caught and have to pay dearly to cover their shorts. Until that day, they will continue to play the game backed by our ever more intrusive government. For now, it looks as though we will see more buying opportunity in the metals and miners as the prices are artificially, but effectively lowered. It will provide the opportunity we need before precious metals resume their upward sprints.

News on Hecla Mining (one of my cores) from MineWeb.com:

40% BOOST IN EXPLORATION SPENDING TO $9.5M

Hecla ups silver production forecasts, lowers cost projections

Hecla's stalwart Lucky Friday mine continues to surprise as a feasibility study indicates mine life could be extended by decades.

Author: Dorothy Kosich
Posted: Thursday , 10 Sep 2009

RENO, NV -

Citing improved business conditions, better operating performance, and a rebound in by-product base metals prices which helped lower operating costs, Hecla Mining has boosted its silver production outlook from a range of 10 million to 11 million silver ounces to a revised 10.5 million to 11 million ounces of production this year.

In a news release Wednesday, Hecla Mining CEO Phil Baker said, "If prices for metals remain at their current levels we should generate substantially more operating cash flow this year than anytime in Hecla's one hundred year history." The company's second quarter cash flow was $20 million.

"At Greens Creek we have lowered operating costs by increasing throughput, while the ore grade at the Lucky Friday mine has improved approximately 10% as a result of grade control measures," he noted. "I am excited that we have announced a second reduction in our cost guidance and I am confident that we should have full-year cash costs below $3 per ounce."

Hecla's estimated cash cost per ounce of silver has been reduced by one-third from $4.50/oz of silver to less than $3/oz. Read it HERE.

This news form Hecla Mining is very good. It is no wonder that the price has been holding well. The graph below shows great technical strength. The breakout was followed by leaps forward. Both RSI and MACD are strong. This price should be going much higher.

It appears that we are about to have another buying opportunity. This will enable us to increase our over all holding in mining stocks. We could even have the opportunity of buying more precious metal coins and ETFs. Keep your powder dry and ready for every such opportunity.

As we look forward to God's working in individuals, families, and local communities, we must be encouraged greatly. He is having His way. He is patient with His people as He calls us to repentance. Let us respond today. Now is the perfect time and we are in the perfect place. We must respond.

I believe He still has great plans for our America. After all, by His providence America was founded as a city set on a hill to be a light to a fallen world. This vision is being restored into the minds of many children by dedicated parents. This is the future of our America which can be fulfilled by the providence of the Sovereign King Jesus. Praise Him daily.

Best to each, Doug

More on gold from MineWeb.com:

China can no longer afford to let gold or silver price slump

Chinese state endorsement of gold and silver as good investments means the country can no longer afford to let precious metals prices drop by any significant amount.

Author: Lawrence Williams
Posted: Wednesday , 09 Sep 2009

LONDON -

With Chinese state institutions hawking gold and silver to the general populace as a good investment (see China pushes silver and gold investment to the masses) - the latest news on this front being that the biggest Chinese bank, the Industrial and Commercial Bank of China (ICBC), is setting up a special precious metals department to handle growing investor demand for gold and silver within the country, the corollary is that therefore the country cannot afford to let precious metals prices fall substantially and thus alienate millions of its citizens who have been taking state advice to buy them.

In a Reuters report the ICBC is quoted as saying ""China is the world's largest gold producer and the second-biggest gold consumer, and Chinese always have a custom to keep gold as personal wealth. China's gold market is growing rapidly and has a huge potential with the growth of individual incomes." Surely yet another endorsement of gold as an investment by a Chinese state concern?

And China certainly has the power to manipulate the gold price in ways maybe not undreamt of by GATA which has long believed that there has been gold price suppression by western governments, central banks and financial institutions. This time the boot could be veritably on the other foot. Read it HERE.

China has become one of the largest player in the mining business, particularly in gold. It may be that the boyz will meet their come upance in China. That would be a crude form of justice.

Looking ahead for gold from MineWeb.com:

FOUR DRIVERS

The keys to gold's near term performance and beyond.

Even though gold may not have been able to maintain its initial surge through the $1000 barrier there are four key drivers towards regaining this figure and moving it further forward in the months ahead.

Author: Jeff Nichols*
Posted: Thursday , 10 Sep 2009

NEW YORK -

Gold may have moved too high too soon . . . but whether or not the metal manages to recoup and hold onto recent gains near or above the $1000 an ounce level in the days immediately ahead remains to be seen. We are nevertheless looking for new highs (above $1,032) in the closing months of the year with gold possibly at $1,200 or $1,300 before the New Year.

KEY ONE: INDIA

I've just returned from India, one of the most crucial markets for gold with a long history and big appetite for the yellow metal. What happens next for gold may depend most on the strength -- or weakness -- of Indian buying. And, Indian buying is both price sensitive and in sync with various holidays, festivals, and the wedding seasons. This is worth a good read HERE.