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Gold/Mining/Energy : Gold Price Monitor
GDXJ 128.07+0.7%Jan 16 4:00 PM EST
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To: long-gone who wrote (56061)7/12/2000 12:28:04 AM
From: Rarebird  Read Replies (1) of 116894
 
Richard, it is possible that Gold and the XAU haven't bottomed out yet. It depends on a number of factors:

1) The dollar. Has it topped out yet?
2) The US equity market. What happens if the Dow, S@P and Nasdaq hit new highs? It could very well happen.
3) Crude Oil. How low will it go? Will it stop at $25 a barrel like most people expect?
4) Economic Growth. What will we see when we get the first estimate of GDP for the second Quarter later this month? Does Goldilox make another encore? It can happen.

What concerns me here is that volume has become very weak on some days lately in some of the XAU stocks. Bear markets sometimes end on a retest of the lows (August 98 low on the XAU and Summer 99 low on the POG) before a rally becomes sustainable and a bull market begins. Sometimes fresh new lows are hit. (They can be marginal new lows.) Sometimes an index will just languish for a while with a downward bias before a catalyst comes along to change the major trend.

Gold desperately needs the dollar to decline and the equity bubble to burst. Economic growth needs to slow down dramatically. It looks very promising for Gold moving forward, but after 18 years of the greatest bull market in history, market participants will give every benefit of the doubt to equities over Gold until the handwritting is explicitly on the Wall and there is no shadow of a doubt.

Gold Stocks are cheap. But there are a lot of unanswered questions that need to be resolved to break the Gold Bear.
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