Where Is Gold Going In This Market

[churchill]

Ron Paul on Legal Tender Laws, Coin Shortages, Interest Rates, Municipal Bonds, the Gold Standard

http://globaleconomicanalysis.blogspot.com/

[flying]

Ron Paul on Legal Tender Laws, Coin Shortages, Interest Rates, Municipal Bonds, the Gold Standard

http://globaleconomicanalysis.blogspot.com/

Excellent article & I especially liked....

Free Competition in Currency Act of 2011

It probably has the same chance as a snowball in hell but we can hope

Edited April 3, 2011 by flying

[Naam]

While not stellar... 9.5% in 6 months is ok with me

+5.2% EUR based = not bad

+2.9% AUD based = not much to rave about

[churchill]

Silver breaks $38 per ounce, a new record high!

http://www.smartmoney.eu/2011/04/04/silver-breaks-38-per-ounce-a-new-record-high/

[Naam]

my advice for Flying was and still is "don't switch your AG into AU!" :jap:

[dananderson]

Both gold and silver are getting strong support currently as a result of increasing 2 fold demand.. With demand comming from investors and industrial applictions, suggest that this is no bubble. I hold AUY(yamana gold) as a long term play. Nice leval of support for gold at 1400.

[Gambles]

Both gold and silver are getting strong support currently as a result of increasing 2 fold demand.. With demand comming from investors and industrial applictions, suggest that this is no bubble. I hold AUY(yamana gold) as a long term play. Nice leval of support for gold at 1400.

Relative to Dow - it's still cheap

the bottom of the DJIA relative to 1 Oz of gold tends to close to 1:1, and certainly below 3:1

if this historic pattern holds (or has it been blown away by the amount of paper created in the last 30 years??) then what's the deal, gold at 12,000? dow at 1400? or both of them meeting somewhere in between (in any of these cases expect a very short lived peak in gold and bottom in equities

we've been floatimng this idea for a while but I still reckon it's quite a way away and maybe 2-3:1 is more realistic in the new paradigm although you could expect Dow and gold to be equally inflated by the surfeit of dollars

cheers all,

Paul

[gregb]

my advice for Flying was and still is "don't switch your AG into AU!" :jap:

Not sure you've proven your case for that Naam.

Silver will continue to outpace gold right up until the peak. Silver has a big commodity component, and a small monetary component. Gold is the reverse. During a period of growth, silver should always outpace gold under normal conditions. Since we are basically in a growth period right now, if you think gold is going up, silver should logically head up faster. So I agree with you to a point.

The problem is there will be another 2008 event. I don't think anyone doubts that. The timing and severity are debated of course. But once the event occurs, Ag will take a nosedive. Gold, having a much larger monetary component, should be less severely impacted. The question becomes:

1) Can you call the top and

2) If you can, can you exit Ag and get into Au before it has dropped precipitously below the ratio where it is at right now.

In a perfect world, I agree with your assessment. In an imperfect world where it takes time to change positions, particularly if you are trading physical, I think we are at the point to start moving out of Ag for Au. Possibly not the whole position, but some. The peak could be anywhere around here, and nobody ever went broke by booking a profit.

[flying]

my advice for Flying was and still is "don't switch your AG into AU!" :jap:

Well actually I have scraped that idea awhile back although I did swap 15% for gold at 47/1

in the hopes of reducing shear weight

But that aside.... this talk about the last 6 months gold performance had me look at Silvers last 6 months & while

gold may have risen 9.5%

Silver did 54%

[Naam]

In a perfect world, I agree with your assessment. In an imperfect world where it takes time to change positions, particularly if you are trading physical

there is no way to trade (in/out in/out) physical precious metals once you have reached a certain volume/quantity. and as far as my "don't switch AG into AU" is concerned i admit it is only a theory based on a couple of years watching the ratio.

[Naam]

my advice for Flying was and still is "don't switch your AG into AU!" :jap:

Well actually I have scraped that idea awhile back although I did swap 15% for gold at 47/1

in the hopes of reducing shear weight

But that aside.... this talk about the last 6 months gold performance had me look at Silvers last 6 months & while

gold may have risen 9.5%

Silver did 54%

it is indeed a hassle handling more than one wheel barrow at the same time

[saraburioz]

I'm thinking of buying a large(for me) amount of gold.

Is this a bad time or not to buy.

[flying]

I'm thinking of buying a large(for me) amount of gold.

Is this a bad time or not to buy.

Just my opinion but.....If you have extra cash & no gold & want to buy it is never a bad time to buy

If you are buying a large amount as you say then why not phase into it. Buying the little dips helps when buying larger amounts.

Chok Dee

[churchill]

U.S. will hit debt limit by May 16, Geithner warns

'The Treasury Department had estimated that the nation would reach its $14.29-trillion debt limit between April 5 and May 31. But in a letter to congressional leaders, Geithner said new calculations based on projections of income tax receipts showed that the date will be no later than May 16.'

http://www.latimes.com/business/la-fi-debt-ceiling-20110405,0,4579379.story

How much is 1 Trillion ??

1 Trillion seconds is --

'One American trillion (ie. 1012) (Leap years counted & Century Leap Years Counted)

One Trillion Seconds = 31,688 Years, 269 Days, 1 Hour, 46 Minutes, 40 Seconds.'

Read more: http://wiki.answers.com/Q/How_many_years_is_1_trillion_seconds#ixzz1IdQPCF14

Makes one think /

http://www.usdebtclock.org

[dananderson]

Agree with gregb on silver. Indutrial application is fueling demand especially when you consider the growing use/demand from tech let alone their is almost an ounce in every new car. New thin solar panels account for 40 niilion ounces alone. 1.6 billion cell phones-over 20 million ounces last year.

[churchill]

I am now 60/40 % Silver to gold and have cashed out some profits recently but think gold/silver stocks are still at least 50% undervalued to the present gold/silver price /

Silver the investment of the decade - Eric Sprott

Silver's performance over the next three to five years is likely to treble that of gold, says Sprott Asset Management Chairman, Eric Sprott, and he is still bullish on gold as well

http://www.mineweb.com/mineweb/view/mineweb/en/page96985?oid=124399&sn=2010+Detail&pid=102055

[churchill]

Bank of Montreal declares "A New Paradigm for Silver"

'Silver investing is going mainstream.

BMO Capital Markets has come out with a report that declares that there is a New Paradigm for Silver.

The report states:

Demand is expected to outstrip production growth. BMO Research analysis indicates silver demand & supply fundamentals should remain positive to the end of 2012E.

The prospects of further quantitative easing combined with sovereign debt concerns, competitive ‘fiat’ currency devaluation in western economies, and the return of inflation could result in investment demand exceeding BMO Research’s projections and extending the supply deficit through 2014E.

This shift in the supply/demand dynamic lies in contrast to the broader investment perception for silver, which is rooted in the 1990’s when the metal was in abundance, driven by the demise of the photographic industry and Chinese selling.

The paradigm shift for silver suggests that the traditional benchmarks for silver, such as the long-term historical ratio with gold, are no longer valid.

Accordingly, the markets are searching for a new set of criteria against which to benchmark the price of silver, with a bias to the upside.

As we have mentioned before, investment in Silver by the general public hasn't even begun. And once capital starts flowing in, the price of the metal has the potential to go parabolic.'

http://whispersfromtheedgeoftherainforest.blogspot.com/2011/04/bank-of-montreal-declares-new-paradigm.html

[churchill]

HUI finishes the day just shy of its all time high

http://traderdannorcini.blogspot.com/2011/04/hui-finishes-day-just-shy-of-its-all.html

[flying]

HUI finishes the day just shy of its all time high

for what its worth (0)

AU & AG are looking like they are ready for a spike

Been coiling awhile now & that is my guess.

[khunjake]

Gold is setting up for a another leg higher. Multiple tests this week right at the 1410 area and each time funds bought aggressively.

There has been a consolidation period going on for several months now and the corrective weakness the past 3 weeks is namely due to April Futures/Options expiration

Will be looking for a breakout over 1445-1450 key resistance the 1st week of April and a major move to $1650-1710 before July.

Taking long COMEX June Gold Contract at 1427.60 this morning with a close under 1410 as a stop.

Got the decisive breakout over 1445-1450 and have also broken the ascending triangle pattern as well.

The gold stock indexes have also responded as well to a breakout so we should hit our target in the specified timeframe.

In terms of actual targets, the range of $1650-1710 is completely valid although opening the lower end more from $1575-1710 would be a consideration as well.

Holding long from $1427.60 basis June Gold...

[dananderson]

The latest on gold/silver price ratio. From Sprott

The report;

the tickerspy.com Staff, On Tuesday April 5, 2011, 11:50 am EDT Eric Sprott's Sprott Asset Management knows a little something about investing in gold and silver, so when Sprott calls silver "the investment of the decade," those are words worth listening to.

In an interview with Mineweb, Sprott said "Silver is the investment of this decade as gold was the investment of the last decade." And it's hard to argue with that assessment as silver prices have nearly doubled in the past year and more than tripled since June 2009. Sprott, who last month said silver prices could go to $100 an ounce, told Mineweb that he does not see a gold/silver pricing ratio of 38:1 to lasting.

"So our view is that it will probably go back to 16:1 and the easiest way to imagine that is that if gold was $1,600, silver would be $100 - so that's essentially the theory that we're espousing," Sprott said in the interview. Sprott added that his firm remains "very bullish on gold," but that he expects silver prices to "treble" gold over the next three to five years.

Not surprisingly, Sprott is also bullish on silver equities. At the end of 2010, Sprott Asset Management held stakes in First Majestic Silver (NYSE: AG - News), MAG Silver (AMEX: MVG - News) and Silver Wheaton (NYSE: SLW - News) along with investments in gold miners such as Barrick Gold (NYSE: ABX - News), Yamana Gold (NYSE: AUY - News) and IAMGold (NYSE: IAG - News).

e report:

Edited April 6, 2011 by dananderson

[badge]

Both gold and silver are getting strong support currently as a result of increasing 2 fold demand.. With demand comming from investors and industrial applictions, suggest that this is no bubble[...]

New and Interesting claims. Source please?

Edited April 7, 2011 by badge

[badge]

So with Gold at new highs Ive ran my ruler over it, and depending on what data I put into my model I get varying Long Term targets, the most poignant of which lie at 1355/65/90, so really anywhere between 1350-1400(!), and then 1575-1600. All rather vague then!

Theres some less potentially significant targets along the way at 1365, 1460 and 1515 too.

In a 'back of fag packet' moment I put Spot AG in too, and came up with Long Term targets around $23.50, 26.30 and 27.50. How that gels with AU or how likely they are to be met I dont know; just a bit of fun

Time to look again at AG in light of its stellar performance. I note all the chatter and links espousing how Silver was always the Beta play than Gold! I dont recall those views in the last couple of years when some of us mentioned this, c'est la vie.

Depending on what data I use the next Possible Sell signals I have lie at around $42.50, then around $50.50, $52 and $54.75. It get a bit steep thereafter; $68 then $78/$80 :|

Gold still biding its time...

[badge]

Some interesting graphs for comparison:

Be nice to have an updated version of the 1st graph. UK Earnings Vs Gold, slowly approaching a long term extreme. US Homes Vs Gold, alos approaching long term extremes. Different this time?

[badge]

Despite the 1998 Dollars used in first graph of the last post, the more recent nominal Gold/Silver ratio has also bottomed around 15:1 - 20:1

Gold needs to decline steeply or Silver need advance rather alot...

Edited April 7, 2011 by badge

[dananderson]

A lot has changed since 1998 relative to world GDP. China is fast approaching Japan. On the investment side of gold as a hedge against currency,inflation by individuals is now under 1%. Back in the late 70's it was 6% and much higher in the earlier part of the last century. How high/low for gold/silver and when is often debated. Here is a good example. http://video.cnbc.co...ideo=1871572009 and http://video.cnbc.com/gallery/?video=1871572009#eyJ2aWQiOiIzMDAwMDE1MzA1IiwiZW5jVmlkIjoiTENSUEt6L3dGUTAvRzBERVI1bzd1dz09IiwidlRhYiI6InRyYW5zY3JpcHQiLCJ2UGFnZSI6IiIsImdOYXYiOlsiwqBMYXRlc3QgVmlkZW8iXSwiZ1NlY3QiOiJBTEwiLCJnUGFnZSI6IjEiLCJzeW0iOiIiLCJzZWFyY2giOiIifQ==

Edited April 7, 2011 by dananderson

[flying]

I am seeing 1467+/oz USD for Gold tonight in Euro/Asia...new USD high?

Silver hanging in at $40+/oz USD

[Naam]

I am seeing 1467+/oz USD for Gold tonight in Euro/Asia...new USD high?

Silver hanging in at $40+/oz USD

YO Flying! do i has to repeat "KEEP DA SILVA MAN!"

mah theory did done workin'... until now

[MRTELLYOUSTRAIGHT]

My mate bought a 10 baht bar at around 1600 per baht a while back, nice.

He was bragging recently about the little profit he has if he cashed in now that was until the other day i asked him why he looked so glum.

He said, once it reached an all time high my misses took it out the safe and i haven't seen head nor tail of it since or her for that matter!

[badge]

Sterling Silver