Gold to 1065 Over Night

Here is gold which continues upward in a broad trough. Note the short red line under that last four days of trading. This shows that the lows have been about the same, as have been the tops until today. This is an indication of possible topping. However, the price is near the top of the trough which is positive. Both the RSI and the MACD are showing an upward bias. At the bottom, I have crudely drawn black lines under the volumes on each prior and current upward moves. Note that the current volume seems to be at the most about half way through what was shown on the last three upward sprints. It seems that this one has more time to go. We will have to see the close today to really get a better indication. I would think that this upward move is still in force and we will see almost immediate higher prices in spite of the intervention.


Below, are the Kitco.com 24 hour graphs for our precious metals. Both sprinted to new heights only to be slammed again by intervention. The peaks (Green Arrows) in both were almost at the same time. Then there were interventions (Red Arrows) at precisely the same time. Somewhat flagrant, I would say. However, both are holding well and should resume their upward trend.



More on the run from dollars by central banks from The Daily Pfennig:

"Recently, the role of the dollar and the euro/yen has been reversed. Previously 63% of new reserves were placed into US$, but lately that number has fallen to just 37%. As Chuck and I have written in recent Pfennigs, the current administration has no interest in supporting the US$, and global central banks seem to be fearing this lack of support. According to the data reported by Bloomberg, the dollar will likely remain under selling pressure for some time to come. Despite last quarter's move away from the greenback, central banks still hold over 62% of their foreign currency reserves in US$, leaving plenty for future sales.

Some of the largest pools of reserves are being held by China, Japan, Russia, and India. Both China and Russia have repeatedly called for the creation of a 'new' reserve currency, so their moves out of US$ come as no surprise. China, which controls $2.1 trillion in foreign reserves is the largest holder of US debt with over $800 billion invested in US treasuries. Investors would be wise to take notice of where these countries are moving their reserves. Pulling reserves away from the dollar will continue to rally the alternative currencies of the euro and yen; and will also put upward pressure on the price of gold which is another attractive alternative for reserves."

Folks, this is serious business. If the banks are beginning to run from the dollar, should not you consider the same technique? Think of the impact of this on the purchasing power of the dollar. The markets will be flooded with dollars, so the reality of increased supply will lower both the demand and the value. We will have price inflation in spades while our unemployment continues to climb. Remember, our fearless, wise leaders continue their "double speak" about desiring a strong dollar while continuing to trash it. Their actions should be so loud in our ears that we can not hear their words. We seriously need to put ear plugs in our ears and sharpen our vision by every means possible. One great way is to follow the economic words and principles found in the Bible.

From Monday Morning:

Canada: China’s Personal Shopping Mall

By Peter Krauth
Contributing Editor
Money Morning

In 2007, Aluminum Corp. of China Ltd. (NYSE ADR: ACH) – better known as Chinalco – snapped up Peru Copper Corp.

A year later, Jiangxi Copper Co. Ltd., teamed up with China Minmetals Corp., to buy out Northern Peru Copper Corp.

Don’t let the names of the two copper companies fool you – both targets were Canadian mining ventures. And all three of the suitors hailed from China.

Commodity-rich Canada has become China’s personal shopping mall.

And the wheeling and dealing continues. Read it HERE.

China is showing a great deal of interest in copper. Of course, their electric infrastructure is being rebuilt and increased to meet the new demands of their industry. They are not dummies as many would like to believe. Here they are showing it by continuing their shopping for vital natural resources. It seems more and more obvious that the recovery is beginning and will continue in Asia more rapidly than here.

From Bloomberg:

Goldman Sachs Cut to ‘Neutral’ by Meredith Whitney

Oct. 13 (Bloomberg) -- Goldman Sachs Group Inc., the biggest U.S. securities firm before converting to a bank last year, was cut to “neutral” by Meredith Whitney, as the analyst dropped her only “buy” recommendation.

Whitney, who correctly predicted in 2007 that Citigroup Inc. would cut its dividend, didn’t update her price estimate on the shares in a summary note distributed to investors today. Further details on the downgrade weren’t immediately available. Read it HERE.

From Bloomberg:

CIT Says Chief Executive Peek to Resign at Year-End

Oct. 13 (Bloomberg) -- CIT Group Inc., the 101-year-old lender that may file for bankruptcy protection, said Chairman and Chief Executive Officer Jeffrey Peek plans to resign.

Peek, 62, joins Bank of America Corp. chief Kenneth Lewis and Morgan Stanley head John Mack, who have said they will step down in the past month. CIT’s board formed a search committee to find a new CEO, the New York-based company said in a statement today. Read it HERE.

WOW! The bailouts for these two too "big to fall" giants has really worked and now they are sound entities. NOT! Were either to fall now after the "successful" government take over, that would reflect on our overall recovery. Are we really in a recovery mode? I believe that any recovery must show a vast improvement in employment. Thus far, this has been very dismal and is getting worse as businesses use cutting workers as a means of slimming down for profit in this economic environment. It broadcasts the importance for one to hang on to the present job even if it is not the best.

Here are our miners from Scottrade's streaming quotes:

Here are the relative value of currencies against the dollar from Kitco.com:

Gold is 1060.10 on an up tick. Silver is 17.69 on a down tick. The DOW is 9848 down 38+.

The Lord is giving us an abundance of rain which prevents me from mowing the back yard. I have mowed the front already four times this fall which is more than was required all summer. We badly needed the rain, so I have no complaints. Our very hot summer without rain was a challenge. Now the cool weather and rain are welcomed.

It is always interesting that the Lord provides for us in His timing and seldom ours. He knows our needs and wants us to express them to Him. He always answers our prayers, but not always exactly as we desire. However, I am always aware that in His sovereign control of everything, He knows what is best. We must rest in Him and know that He is God and we are not. This is particularly important as we are living in a pagan age in our society. Praise King Jesus daily as ask Him to heal our nation and bring it back to Him.

Best, Doug