Rarebird, here is an exerpt of a post from Kitco that focuses on an idicator called On Balance Volume. It was pretty long winded and I edited it for brevity:
Date: Fri Aug 13 1999 23:41
goldfeverUS (ASA vs. MSFT; a study in opposites....) ID#433278:
Copyright ¸ 1999 goldfeverUS/Kitco Inc. All rights reserved
ASA vs. MSFT, a study in opposites; a "war" of two ( seemingly separate ) worlds
If you look at, and study, nothing else, and do nothing else, all week-end, in the investment research arena ? than this; then, at least DO THIS:
Go to decisionpoint.com and to their ?Live Charts? section; or to icq.com; or to any other source of daily, historical and current stock prices, including technical timing indicators, to include OBV, or
?on-balance-volume? .
And select two stocks: ASA, and MSFT; to study.
Compare their price and OBV patterns.
LOOK at the stock ASA, along with it?s OBV indicator; for either 6 mos., 12 mos., or 18 mos.;
and even 48 months. ASA is the symbol for American South African. Later, there may be an opportunity to explain,
how enormously important, this BELL-WEATHER gold mining stock ( a closed-end fund ) , actually is; not only to the entire mining industry, but also as a representative SIGNAL and tool, of timing research, for the entire gold and precious metals markets, as a whole-group, or sector.
ASA has a very thin/small capitalization, and float. Thus, it is enormously sensitive to, and indicative of,
where gold is going next..... including silver, and all precious metals related investments, etc.
Look at ASA?s OBV, or on-balance-volume line...
You will see that its pattern is bumping up against a double-top, or twin highs, for the recent period.
You will also see that the OBV line has been rising for several years now, while the price has been
downward, bearish; still being held down, and held-back, at the $18/sh. range.
AND SINCE VOLUME PRECEEDS PRICE, we can clearly see, ( - as the market-place is once
again telling us, before it makes its next move ) ; that the gold market, and this stock, ASA?a most
important bell-weather of all precious metals markets; are about to go ?? UP and UP and UP.
This, we can see from the gradually rising OBV pattern for many years, that this stock has been ?
?. ?under accumulation? ? for many years, now. And moreover, right NOW, with the OBV line bumping-up against, an all-time OBV high of what is identified as?? a?.
?ceiling-level-overhead-resistance? ... level ??; it, the OBV pattern, is just on the verge of being about to break-thru, and break-out, to the UPSIDE. Look at the chart; it is obvious, n?est pas ?
All that remains, for the dam to break, and the bull market in gold to begin, in earnest; ( and for many years to come ) ; is that for NOW, for ASA?s OBV pattern, to break-thru this immediately apparent, and final-overhead resistance, or ceiling-level. This is nothing more than a hiding-opportunity; a profound opportunity?. of perhaps once in life-time - dimensions.
This ASA stock?s feigned, seemingly bearish price-chart pattern, on the surface; is about to be revealed, in a new bull market. For there is identifiably by any objective student of market timing research, a pattern of consistent build-up of buying pressure; that has built-up, or accumulated in this stock, for the last several years.
This build-up of buying-pressure, this ACCUMULATION; is revealed by the persistently rising OBV pattern, which can be seen on the chart. The stock is still, but for a moment more, perhaps; yet temporarily holding on, to this overhead resistance pattern of its OBV. .. which is about to be penetrated, and will give-way, very soon,
to the upside. Yes, this overhead ceiling will be broken-thru, to the upside, and very soon.
Thus, I believe ASA will begin its new bull market, as will gold and all precious metals related investment markets; this next week, the third week of August, 1999. This historical time, this turning-point period for all investment markets; holds a curious coincidence, for in August, 1976, gold also reached a historic low, and turning point, at that similar ?yearly-cycle-time?.
I sincerely believe we are ?perhaps? about to witness the greatest bull market in gold and silver, and in all precious metals markets, including gold stocks, and gold funds; that the world has yet to experience.
For, far higher prices for ASA, gold, silver, gold stocks, and gold funds; may be about to begin their steady and enduring advance; as evidence by the imminent break-out pattern of ASA?s OBV.
May I repeat: for gold, silver and the mining shares/stocks the greatest bull market in human history is, I believe, ?per-chance? ?.. about to begin.
This is, what I believe the markets are telling us, and as I interpret the markets, according to my study, research, and experience of them; over more than 3 decades.
Most importantly, keep in mind: there are no guarantees; and I neither offer nor suggest any. And furthermore, I have made many, many mistakes; rest assured. And rest assured, also, that: the markets themselves; never make mistakes. The eternal question of vital importance, for all market-timing-students, is: the often ?elusive? question: ?are we in-tune-with? the markets themselves, and with what they are always telling us, before they do their next very thing. For the investment markets are always clueing us, or signalling us, in advance; but seldom do we truly strive to objectively, patiently listen, and to follow, the market?s lead.
Personally, in my 32 years of investment timing research and experience, primarily technical-charting;
I?ve never seen or identified or run-across; what this metals market is persuading me to, NOW.
We will ?possibly? see far higher prices for gold and silver and the mining stocks/funds;
far higher than anything, any of us could realistically predict, or have even imagined.
Remember: no guarantees, no promises; and investing always implies and assures, risk. |
