25/03/2011 by Philinje.

Just as gold and silver were breaking out yesterday, the CME announced another hike in margin levels, which punched a hole in the balloon.

Actually with gold it looked a lot like the typical take-down by you-know-who. My guess is they used the CME announcement as the perfect impetus to do a quick raid. Again, in recent months the bear raids have been relatively infrequent and it seems they have to pick their shots carefully. So while some people might have been forced to liquidate some positions, and others were taking profit as silver went past $38, the big boys were using the CME news to maximum effectby running stops.

Despite all that, silver dropped only to $37 and has quickly moved back to the $37.50 area. It just won’t sink that much, and keeps bobbing back like a beach ball. The likely target is $39 once it gets through $38, and that could happen any time. The upside target for gold is $1456 if it can make it through $1441.

So today, if buying pressure keeps moving prices up, then the CFTC-related selling might have been a minor blip. We made it past the 10am low without much damage. Let’s see if we see a similar rise to yesterday’s without the hard sell-off in the afternoon. Then we’ll be in good shape for a strong week next week as March draws to a close.

Posted in Gold | Print | No Comments »

23/03/2011 by Philinje.

Looks like equities are waffling and gold and silver are taking off. This short-term uptrend could go till end of March. Mining stocks are exploding.

Posted in Gold | Print | No Comments »

21/03/2011 by Philinje.

Today there seems to be a global sigh of relief that the nuclear power plant problems in Japan have subsided. Here in Japan it seems that some definitive steps toward normality have occurred in the past day or two.

So the risk-on trade is back in all its glory. Gold and silver are benefitting from that, but not commodities like copper. While gold and silver look strong, there is a major cycle ending tomorrow and it might be worth waiting a bit to see what happens. On the other hand, really aggressive traders could jump onto a short-term uptrend and hop off at the first sign of trouble.

Anyway, let’s cautiously be thankful that much worse did not happen. That would have been a tragedy beyond belief for Japan. Maybe it was unlikely but the risk was definitely there. The markets over-reacted, to be sure, so we can expect to see a relief bounce.

Posted in Gold | Print | No Comments »

15/03/2011 by Philinje.

The earthquake/tsunami/nuclear accident did it, as nothing else could!

We may get a relief bounce, but it’s clear that risk is off in a big way.

There is now high risk in being in the market, any market.

Posted in Gold | Print | No Comments »

14/03/2011 by Philinje.

Silver sank to $34 on Friday then promptly rebounded to $36. Simply amazing. But equities are weak and the mining stocks are not so hot, plus silver is near a turning point in terms of cycles.

There is a target of $38 in silver and $1474 in gold. Maybe we’ll get there soon, maybe even tomorrow, or maybe we won’t get there at all on this rally. Be nimble this week. There are some forecasts of higher than $40 by end of March. Who knows. A monster short squeeze could happen. There are still plenty of March contracts to be delivered. Hard to say.

But if equities finally turn south, things could get pretty ugly all around. Be careful.

Posted in Gold | Print | No Comments »

08/03/2011 by Philinje.

Also from the same author, an excellent analysis of the NFP numbers:

http://news.coinupdate.com/a-double-dose-of-deceptive-unemployment-statistics-0711/

Posted in General | Print | No Comments »

08/03/2011 by Philinje.

Back to the theory of a supply squeeze in silver. The March contracts have suddenly dwindled and are not standing for delivery - rather mysterious behavior, given the large number of contracts that were open by the time March contracts were expiring.

Nevertheless, the silver price remains very strong and in one day we hit resistance at $36.50, came down to $35.50 and are now back up to $36.50 a day later. Various analysts are calling for $40 before a pullback, or maybe slightly under $40.

Here are a few excellent articles from a coin dealer. Normally this would be a biased source of information (they are trying to sell you coins) but in this case the information is fairly objective and useful. The first one talks about the jump in lease rates I mentioned a few posts ago, as well as the movement of funds away from US Treasuries:

http://news.coinupdate.com/more-indicators-of-physical-silver-supply-squeeze-0680/

Please note he talks about a rise in price through March. It is also the case that the new position limits imposed by the CFTC come into effect at the end of March.

The second article is more recent and provides details about the March contracts mentioned above. This situation has changed since then, as stated above.

http://news.coinupdate.com/huge-comex-silver-supply-squeeze-developing-0695/

And this last piece gets into rumors of Asians buying SLV shares to redeem for physical silver:

http://news.coinupdate.com/asian-buyers-redeeming-physical-silver-from-slv-exchange-traded-fund-0685/

His target price by end of March is $38 to $45, which he thinks may be too low if a supply squeeze is really occurring. Other sources are talking about a top at end of this week or early next.

Posted in Gold | Print | No Comments »

07/03/2011 by Philinje.

This free service forecasts silver at $39 in 9 more trading days:

http://www.gunner24.com/newsletter-archive/march-2011/06032011/

Please note the resistance at $36.50 was already hit in one day.

Those watching the recent dollar weakness can get some good analysis here:

http://pragcap.com/dollar-index-breaking-down-again

We may see a slight relief rally, but a breakdown here could be very serious.

Posted in Gold | Print | No Comments »

03/03/2011 by Philinje.

So far, there is very little weakness in silver or gold, and a fairly relentless move up. Recently there has been strong correlation with oil, which is responding to the unrest in the Middle East.

So far gold hit $1440 and silver $35. Maybe we’ll get a pullback here but of late the pullbacks have been mild. March, though traditionally weak, is looking strong so far.

Posted in Gold | Print | No Comments »