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Strategies & Market Trends : Natural Resource Stocks -- Ignore unavailable to you. Want to Upgrade?

To: crustyoldprospector who wrote (14100)	7/31/2004 4:34:44 PM
From: jimsioi	Read Replies (1) \| Respond to of 108601

crusty, thanks for the references I found these comments from Robert Mchugh to summarize the technical situation quite well. "M-3 is essentially flat since May 17th, up a mere $9.8 billion over that 9 week period, less than 1 percent annualized growth. Our research shows that whenever M-3 is flat or down for a period of two months or more, equities decline within one to three months thereafter. The U.S. Dollar is ready to turn down as price action formed a key reversal Hanging Man candlestick pattern Friday, at the point of formidable resistance, the long-term declining trend-channel. The Dollar has formed a Bearish Head & Shoulders Top and a decisive break below 87 will confirm the pattern, with a minimum downside price target of 82. The RSI sits where three recent tops occurred and upside momentum looks like it has peaked. Prices should fall from current levels if for no other reason than they sit at the top of the long-term trend-channel, the place where declines are born. It is do or die time for Gold the metal, as it is forming a Bearish Head & Shoulders Top and prices have sunk to the lower boundary of its long-term rising trend-channel. There isn't much downside room for Gold before technicals turn decisively Bearish. Should Gold drop below 375, the minimum downside target is 320. Let's all hope this doesn't happen, for if it does, it likely means massive deflation has or is about to occur. The first place this deflation would materialize would likely be in financial assets to soon be followed by real estate assets, then incomes, then goods and services. By the time it hits goods and services, we are likely in a Depression. Before that were to happen, expect the Federal Reserve to open the liquidity spigots wide. The Dollar would be sacrificed before deflation were allowed to take control. Our chart of the Dollar may be discounting this scenario. Once the Fed pumps the money faucet, Gold should recover. So there may be a terrific buying opportunity coming in Gold and precious metals. If you missed out before, you may be about to get another chance." safehaven.com I see all those technical points...Hanging Man on the Dollar daily, Friday, importance of this last week's lows and near by trend lines for Gold. It's hard to imagine all potential scripts coming to fruition at once....dollar falling and Gold falling. Quickly Robert sees the FED coming in to halt deflation....Curious to me is that they, the FED, would let such get started if they'd come to the rescue so quickly, however Money Supply is flat. Quick view of the Gallemore charts shows Dollar Trend Indicator at the top of scale still rising, while Gold's is at the bottom and Silver's has turned. I suspect one more run out of the dollar bears, a test down in Gold and then some settling back in the dollar and a likely low momentum rally in Gold, beginning sometime next week... chartingyourfutures.com HUI chart indeed looks increasing vulnerable to a fall, probably into Sept/Oct institutional tax selling seasonal lows with general equities. Important cross roads...