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Strategies & Market Trends : Ride the Tiger with CD -- Ignore unavailable to you. Want to Upgrade?

To: rubbersoul who wrote (130121)	9/6/2008 10:31:59 AM
From: Claude Cormier	2 Recommendations Read Replies (1) \| Respond to of 312985

- Claude, gold is currently just sitting above its 21-month MA. It has been the line in the sand for 6 years. I agree. And gold could drop lower. What I am saying is that would only signal a cyclical bear market within the long term secular bull whic is now pausing. If you take a look at the long term secular bear market we just had (1980-2000), that same 21-month MA was penetrated may times and crossed above the 34-month MA on many occasions making investors believe that the bear was over.. it was not the case. In the same way, during the 1970-1980 bull, the same thing happen in the other direction making inestors believe that the bull was over and that gold would return to double digits. It was not the case. I think that support will hold between $775-$825. That has been my main scenario since early this year. But if it doesn't, it is not the end of the world. Gold may continue down for a couple more months, but it would bottom eventually somehwre in the $600-$700 range. This would be a short bear market (as short as this deflation scare we are going through). Stocks at that point will likely start to finally outperform. The coming resumption of the secular bull will be unlike anything we have seen so far. A real bubble. But first we must suffer a little. That is my opinion. Time will tell if I am right or wrong. The best strategy appears to be to accumlate valuable gold juniors at low price and two hedge your bet with either Bear ETFs or ITM put options on gold seniors, gold indexes or better US equities. ITM call options on Bear ETFs could provide the ultimate hedge. I may have a discussion on this soon.