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Strategies & Market Trends : Strictly: Drilling II -- Ignore unavailable to you. Want to Upgrade?

To: jrhana who wrote (33975)	11/29/2003 12:18:11 PM
From: jrhana	Read Replies (1) \| Respond to of 36161

From the Privateer's "The gold Bull Market This week" <Gold poked its head above the $US 400 level twice this week. On the day before Thanksgiving, November 26, the intraday high on the spot future Comex contract was $US 402.00. On that day, the volume was a HUGE 155,000 contracts plus. Then, while Comex was closed for metals trading on November 27-28 - Gold poked its head above $US 400 in London trading on November 28. Gold's PM fix in London on November 28 was $US 398.35. Based on Comex trading, which closed for the week on November 26, Gold was up $US 0.80 for the week. Based on the London PM close on November 28, Gold was up $US 2.35 for the week. Either way you look at it, Gold remains on the verge of $US 400. The only other item of interest on the weeks trading was that the Comex spot future contract was hauled down $US 4.50 to close at $US 391.50 on Monday, November 24 - this to cater for the options expiry on the day. We haven't seen a sub $US 390 Gold close on the spot future Comex contract since November 11. We are far more likely to see a $US 400 plus close than we are to see a sub $US 390 close in the immediate future. Here are the relative performances of $US Gold, the $US Index, and the Dow since Gold broke above $US 300 to stay on March 27, 2002: Market March 27 Nov. 28 Result Percent $US Gold $302.20 $396.80 +$94.60 +31.30% $US Index 118.91 90.28 -28.63 -24.08% Dow 10427 9782 -645 -6.19% If you doubt that Gold's breaking back above the $US 300 barrier to stay in March 2002 was a "sea change" for world markets, a glance at the percentages in this table should settle the matter beyond all reasonable doubt. Please note in the table above the 90.28 close for the $US index on November 28. This close, the index was down 0.55 on the day, is yet another 2003 low and the lowest close on the index since the week of January 17, 1997. You can see the breach of $US 400 on both the daily and weekly bar charts, both of which show intraday trading. On the daily bar chart, Gold came back to just above its longer term (20 day) moving average during the minor correction of Nov. 24-25, only to soar back above both moving averages on Nov. 26. The shorter term (10 day) moving average remains above the longer term one and the spot future price remains above both. The weekly bar chart shows the steepening uptrend lines on Gold and the shallower and shorter duration corrections in recent months. The shorter-term (20 week) moving average has steepened, $US 400 Gold has been breached intraday, and the upward pattern is like a railroad track. On the point and figure chart, Gold shows its tight range since it broke above $US 390. Don't forget, this chart is based on CLOSING prices. On this chart, the important fact to stress is that the line which forms the TOP of Gold's uptrend is presently well ABOVE the $US 400 level. Here's another perspective - a comparison between Gold's 2002 low and its present price and the $US index 2002 high and its present "price". All data is on CLOSING levels: Market 2002 High/Low Nov. 28 Result Percent $US Gold $278.40 (1/24) $396.80 +$118.40 +42.53% $US Index 120.59 (1/31) 90.28 -30.31 -25.13% You will find charts of the $US index and Gold here for comparison. Given the steadily sinking US Dollar, combined with the steadily sinking appetite of foreign private buyers for US financial "assets", a Gold price of $US 400 plus is an absolute CERTAINTY. Next week we are back to a full week's trading on the Comex. Let's see what happens. For nearly two years now, ever since Gold broke above $US 300 to stay way back in late March 2002, all eyes have been looking UP at $US 400. As long ago as early February 2003 (in Asian trading), Gold broke above $US 390. When an important technical/psychological barrier is broken, the "ceiling" becomes a "floor". Plus $US 400 Gold will turn all eyes from looking back at $US 300 to looking forward at $US 500 and points higher. As we have said here before, the overwhelming likelihood is that once Gold breaks through $US 400, it will accelerate upwards.> ©2003 The Privateer Market Letter