Thoughts on Markets

Monday, November 08, 2010

Gold & Silver Resilient - HL - TLT - Miners - Currencies

Rest assured that the Sovereign Ruler of all; that is, King Jesus has all under control and is moving things to the glory of His Father. Of course, it is our mission to be doing the same to all within our scope of influence. Scripture tells that He is God, that we are His sheep, and that our mission is to glorify and enjoy Him forever. Thus, we can be still and know that He is God and is the source of all our joy and peace.

Gold price rise is more than just a devaluation of the dollar

There are more things at play in the recent sharp gold price increase than just the corresponding fall in value of the U.S. dollar. HERE.

World Bank head suggests a modified global gold standard
Writing in the Financial Times, World Bank president, Robert Zoellick, called for a "Bretton Woods II" system of floating currencies which, he said should also consider employing gold as a reference point. More shots fired at the dollar pointing toward the eventual replacement of the dollar as the sole reserve currency of the world. It is coming! HERE.

Gold hovers near record
While the yellow metal slipped for the first time in three sessions during trade on Monday, it remained close to its latest record high. Down a bit today, but still going higher long term. HERE.

Toussaint bullish on gold; Gartman thinks gold heavily overbought for now
Interviews with Jason Toussaint and Dennis Gartman who express differing viewpoints on where gold goes now. Contrasting views give us opportunity to consider sides of issues. HERE.

Friday's High Volume Gainers With Bullish Options Sentiment
The following is a list of high volume gainers with bullish option market sentiment, i.e. a large number of open call option positions relative to put option positions. The list includes Hecla Mining which is among my core holdings. HERE.

It looks to me as though long term Treasuries are in trouble. Many of us had been expecting this to happen, but a bit earlier. That may be the reason for the Federal Reserve to be buying them. Take a look at the following graph from at Friday's close:

Miners from

Currencies from

Some prices: FVITF 4.02 (That is tempting, but I would like it a bit lower.); SILA 0.71 (Do not like it this low, but it could be consolidating for a higher move. This is a loser for me, thus far.); BULM 1.00 (It seems to be firm between 0.98 & 1.00); TWDIF 0.3189 (Still above Doug Casey's buying price of about 0.24); Gold off only 0.90 to 1393.20; Silver up 0.06 to 26.81; DOW down 61+ to 11383.76; SPX down 5.80 to 1220.04.

The resilience of the precious metals may mean that I will have to be very quick on the trigger to buy on dips which are short and shallow. The question is, "Have we already had the expected correction?" I really do not know. We do seem to be in a consolidation trend for hopefully a higher move. The market will tell us when it is the proper time, I pray.

Best to each, Doug


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