US Stock indexes remain sleepy at 1230CST. I always look at markets before I go to bed, and tonight, the only stand out feature is the metals. Gold and Silver continue to rally.
Gold has posted a new high at 1215.4 and ditto for Silver at 19.355. While we are in virgin territory for the metals, the pattern of 15 to 25 dollar jumps in the gold, with much smaller incremental moves in the Silver point towards this trend marching on.
When will it be near to an end? Most likely when Time or Newsweek magazine has a front cover story about the metals. Another tip off that its late in the day will be stories above suburban housewives throwing gold parties, or some such similar activity. For the time being, we will run opposite to the US dollar. This is not a scarcity issue. There is plenty of gold and silver for the world’s jewelry or manufacturing needs. This is only about the US Dollar weakening and a desire for a physical commodity to hedge the continued melt-down in the Dollar Index.
I expect to see some healthy profit taking along the way. Remember last Thursday’s 65 dollar free-fall in the gold? We have rebounded from that and moved higher.
Another sign of a market top will be wild price gyrations on a daily level, on decreasing volume and open interest in the futures contracts.
Good Trading
