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Gold/Mining/Energy : Gold Price Monitor

GDXJ 97.99

+0.3%

Nov 11 4:00 PM EST

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To: scotty who wrote (22572)	11/4/1998 12:22:00 PM
From: Giraffe	Read Replies (1) of 116753

Tuesday's post from Precise Buy Signals: Technical indicators are screaming "Over-bought!" in paper assets and "Over-sold!" in hard assets. Joining the chorus in perfect timing with confirmation is financial news which often pinpoints turns in markets with exactly wrong projections of popular press, promoting continuation of up-trends in stocks and down-trends in hard assets at trend extremes and reversal points. Today they are bashing gold (again), noting it to be within multi-years lows and "nearing breakdown". Gold stocks are holding XAU 73-76 and displaying remarkable resilience as December gold struggles with $290. It is probable that gold was drawn lower today on news of increased Russian exports of silver, pulling silver below $5 where Indian buyers provide support. Financial news says that because gold has not reacted to the favorable developments of falling interest rates (making owning and storing gold more profitable), reflation probability and the weakening dollar, it probably won't. These conditions are developments in process which are INCREASING the probability of renewed interest in gold. Striking a demarcation point in this process and proclaiming victory of paper assets over hard assets is popular journalism at its finest. As a practical matter, we want to see a turn up from here and confirmation of that turn before acting on gold. Gold stocks' 8.3% gain of 10/27 still leaves short-term technical indicators a bit over-cooked.

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