Mish's Global Economic Trend Analysis Message Board

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Strategies & Market Trends : Mish's Global Economic Trend Analysis

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To: mishedlo who wrote (1956)	3/13/2004 6:16:17 PM
From: yard_man	Read Replies (1) of 116555

I like the guy's discussion of the election and general state of illiteracy of the electorate -- but look at what he posits for the catalyst of a stock market decline AND increasing gold prices (while the shares suffer a beating): the old foreign selling of treasury calamity. It's the same old worn out theory -- tied to the echo of the last cyclical bull in the gold market. He says things are different, but then he falls back to analyzing the present in terms of that same recent period. Higher interest rates, if they happen, WILL NOT be a catalyst to move gold higher -- if this calamity scenario comes to pass -- gold will move lower, not higher, but I think there are a number of reasons to think this foreign dumping of treasuries just won't happen overnight and not for years to come either. Can gold stocks take a whupping if all stocks are sold?? DUH -- the answer is in the question. These writers seem to all fall over themselves to say this: Here's my advice. Take a little bit of comfort in it for two reasons. They may not say it, but they are thinking market collapse -- not just a resumption of the bear, but an illiquidity type event. 1) So much talk about it (even just the intimations) means it MAY not be emminent. 2) Gold shares have one heckuva wall of worry right now, while generally speaking the technicals remain fair to good. Absent a low probability event occuring -- gold and gold shares are poised to move higher. Watch the technicals and key levels. Last week was touch and go for me -- I wanted to see HUI == 220 hold on a closing basis. 2 days 220 was broken intraday, but held into the close. A break of 220 isn't special except over the pretty near term -- we've got a small pattern there of higher lows, which I would like to see remain intact -- if it doesn't I'll cut back until more is clear -- but for now, things don't look that bad. Even if we break 220 on a closing basis now, I would only sell looking to reload at the next support level ... At some pt you have to watch what you are doing -- how the shares are acting and ignore the noise. That's what I intend to do.

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