Yesterday's Kaplan Comments
<< KAPLAN'S CORNER:
Question: How would you interpret the trading activity in gold on Tuesday?
Answer: Locals on the COMEX waited until the European markets had closed so that a small amount of money was sufficient to probe the area just below $270, looking for sell stops. When few were found (hardly any speculators are long gold), the market partially rebounded. With virtually no remaining sell stops and few technical targets on the downside, the rebound is likely to be swift and decisive, with powerful physical buying continuing to provide strong worldwide support for the yellow metal. Just as importantly, the recent weakness in the U.S. stock market is almost certain to lead to a sharp drop in the dollar, which will also push gold higher. There is a classic delay pattern at work: first bonds fall, then the stock market drops, then the dollar plunges, then gold soars, then commodities surge. We are in the early stages of the second phase of this pattern. >>
<< Tuesday's COMEX gold estimated volume was an extremely heavy 125,000 lots. Total COMEX gold open interest on Monday fell 3,185 to 196,702 contracts, demonstrating moderate speculator short covering on a day when gold edged down 40 cents, which is bearish. COMEX silver open interest plunged 4,480 to 75,799 lots, as the speculative bubble begins to burst. Tick, tock, dickory dock, watch silver collapse down the clock. COMEX gold warehouse stocks surged 49,487 to 879,412 ounces, while COMEX silver warehouse stocks edged up 11,069 to 78,283,418 ounces. >>
goldminingoutlook.com
Morning Richard,
I guess Kaplan is both bullish and bearish ... Either a question of timing or he is confused. :-))
That 125,000 lots yesterday was certainly a heavy volume ... IMHO, we spend too much time on who is selling, rather than on who is buying.
John
PS - I have noticed a sharp increase in the number of negative Y2K progress reports in the last few days ... maybe the masses are catching on that all is not rosy.
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