Thoughts on Markets

Tuesday, April 06, 2010

Both Silver and Gold are in breakouts

Silver and gold are following through this morning adding to the breakout on the graphs from yesterday which follow.

What we are seeing in GLD and in Gold, itself, is what looks like a strong breakout from a series of lower highs since near the end of February and the first of March. The graphs of both are very similar and the technicals are very strong. The market will reveal if this is a big change or just another failed attempt.

Standing ever in the background are the central and bullion banks with their continuing War on Gold. They have been successful in capping virtually every rally in the precious metals for decades. Their actions are flagrant intervention and manipulation.

There has been a change in some of their action, of late, because the central banks and sovereign wealth funds have been buyers of the barbaric metals. Thus, it could be that we are nearing the end of the manipulation of the paper market for the metals. We can always hope and pray that this is true, but we must face the fact that the banks have a vested interest in their unbacked monopoly money. Governments enjoy the control that the unbacked currencies give them, so they are allied with the banks in the intervention.
If one is a risk taker and has the funds available, it could be a good time to attempt to profit from the gold breakout by buying calls on GLD. If you should chose this approach, I would suggest that you do so in small chunks as the price moves upward. There is little with as much satisfaction as being able to average up with a winning investment.
Even our Harmony Gold is coming alive with the breakout in gold. It's graph is similar to those, above. However, the 50 day moving average is below the 200 day, but the price has now passed upward through both averages. I would like to see the 50 day move upward passed the 200 day for the normal condition. HMY is still a good miner.
Below is today's graph of BYD Company which remains quite strong. It has been on a tare and maybe looking to take a breather before bounding forward again. We are beginning to see some mixed signals, but I like this company very much and expect to keep it in my portfolios for some time.
Here are the miners at opening from

Here are the currencies from
Some early prices: BYDDF 10.50; FVITF 2.79; TBT 20.53; UUP 23.90; DOW off 15 0955; Gold up 7.70 to 1142, and Silver up 0.24 to 18.14.

Best to each as you follow the law given to us by King Jesus through Moses. Praise Jesus Christ daily.

Best, Doug


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