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Strategies & Market Trends : MDA - Market Direction Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Crimson Ghost who wrote (48404)	4/27/2000 1:27:00 PM
From: pater tenebrarum	Read Replies (3) \| Respond to of 99985

George, as i have pointed out several times, the XAU has produced a big falling wedge. what has changed in recent days is that some of its individual components are sending out technical buy signals. furthermore it has basically not gone anywhere for the past four weeks (it was trading at today's level exactly four weeks ago), in spite of the wild surge in the dollar. furthermore the commitments of traders report shows commercial hedgers net long gold by a wide margin. so the ingredients for a rally are all there, including towel throwing by some long term investors in gold stocks(that's based on anecdotal evidence from some of the gold specific message boards on the net which was confirmed in Kaplan's latest report which scotty just pointed me to). no need to discuss the fact that gold stocks are historically extremely cheap, as the market accords their reserves very little value. bearish sentiment is pretty pronounced. not even Bill Seidman brought himself to concede that the worst inflation data in ten years might be good news for gold (he talked differently when the gold price rallied last time...then he said it was a reflection of the increasing inflationary pressures). one thing is pretty certain imo, as usual, the rally will be very swift and violent when it comes, and perhaps a short lived affair again. since often the initial move off the lows is so quick and powerful, one has to be positioned before it happens. regards, hb