Thoughts on Markets

Monday, December 14, 2009

Correction Ending?? -

This is the time of year, that all are rushing about to finish the mad rush of Christmas shopping. We have become a materialistic government to the highest extent. There is no time left for the real purpose of the Christmas season which is to worship and honor King Jesus who came to earth to die in the place of His own sinners. Each could not be good enough to be saved from the fire of Hell. Therefore, the Father sent Him to die for each and every one of His chosen people. After Jesus' death, the Father raised Him from the dead and placed Him at the right hand of God the Father to ever intercede on behalf of His people.

It is a wonder that God chose any of the sinful people in the world, but through His grace and mercy He did save some which He had chosen before the world was even created. Then throughout the ages He sent the Holy Spirit to bring to life each of His people and to lead them to know that King Jesus is the only way, the only truth, and the only life. I pray that each of you have or will come to this knowledge by God's way.

As happened on Friday, we are seeing the same action beginning today, but slightly later. The computer traders are seeing what the manipulators are doing and then climbing aboard to increase the impact as a sort of snow ball action. Though both metals are down from highs, they are up some today. The demand must still be strong. By the way, I understand the the U.S. Mint is to resume minting gold coins again. Wonder if they are using the remainder of the U.S. stock of gold or have obtained some extra for the coins.

The silver graph looks very similar and suspect as does the gold.
CEF is the Canadian Trust which is invested in both silver and gold. It is a relatively steady type of investment which will move up or down with the metals. From the graph, below, we would expect it to move up toward $16 once it passes the 50 day moving average after the correction ends.
DRD Gold suffered from a strike and other detractors, but seems to have risen above them now. It has been hit hard by the correction. I see it as being in a reasonable buying range, but would like to see it move above the 50 Day Moving Average and then have the 50 Day move above the 200 Day. That move would move it strongly in a positive direction. Until that time it is, in my opinion, a reasonable risk.
Hecla Mining, a silver play, remains one of our star performers. HL is showing sign of potential move forward in the very near future. Its last correction was very short and this one appears to be about half over presently. This has been a great performer and should continue to be good for us.
Retail Sales Report from The Daily Pfennig: "U.S. Retail Sales rose 1.3% in November, nearly double the 0.7% increase Wall Street had predicted. (I didn't see .7%, I saw a forecast of 1.4%) And of course the media did not report that October sales were revised down to a 1.1% increase from a previously estimated 1.4% increase. But don't let that downward revision get in the way of a party to celebrate a 1.3% increase in Retail Sales! And that's exactly what happened!"

Just more double speak from the Federal Government. Did you expect the truth?

From MineWeb.com:

Recent gold price dip, just a minor hiccough

While gold prices have fallen over the last few days on a slightly stronger dollar the fundamentals for the gold rally have not changed at all

Author: David Levenstein
Posted: Monday , 14 Dec 2009

JOHANNESBURG -

When the US non-farm payrolls were released on Friday 04, December, the US dollar rebounded immediately on the encouraging numbers. As to be expected the gains in the US dollar put pressure on the gold price. Then, on Friday December 11, gold eased after running up some US$15 during the day due to the stronger than forecast retail sales data, which caused the dollar to rally. As retail sales increase there is an expectation that the Fed may begin raising rates and that is considered to be bullish for the dollar. November retail sales rose 1.3% versus a consensus forecast of 0.7%. Sales excluding autos were up 1.2%. So does this mean that we have seen the high for gold and the low for the dollar? Read it HERE.

From MineWeb.com:

Russian Central Bank to buy 30 tonnes of gold from Gokhran

Russia's Central Bank will increase its gold holdings by around 5% by buying 30 tonnes of gold from the State repository which had been planning to sell the gold on the open market.

Author: Polina Devitt and Robin Paxton
Posted: Saturday , 12 Dec 2009

MOSCOW (Reuters) -

Russia's state repository will sell 30 tonnes of gold worth $1 billion to the central bank next week, a source at the body said on Friday, keeping the metal inside Russia after rethinking a plan to sell it on the market. Read it HERE.

From MineWeb.com:

Gold the best currency - John Paulson

Top U.S. hedge fund manager John Paulson is now much more bullish on equities in general and gold in particular. 46% of his firm's holdings were in gold and he is starting a specialist gold fund next year.

Author: Daniel Bases and Joseph Giannone
Posted: Friday , 11 Dec 2009

NEW YORK (Reuters) -

Billionaire hedge fund manager John Paulson said on Tuesday he still sees compelling long-term returns in equities even after their sharp run-up this year, while holding no short positions in the credit markets. Read it HERE.

Don't forget about tax selling to realize by selling big losers with little prospects of their recovery in time for income taxes this year. Also, if you have capital gains which are going to result in taxes, you could advance pay real estate taxes, contributions to church, etc. to offset taxes. But all must be accomplished this year.

The miners from Scottrade.com:

Currencies from Kitco.com:

Merry Christmas, Doug



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