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Gold/Mining/Energy : At a bottom now for gold? -- Ignore unavailable to you. Want to Upgrade?

To: Bobby Yellin who wrote (1062)	1/21/1998 6:15:00 PM
From: Bo Bob Brain	Read Replies (3) \| Respond to of 1911

Some of the support that we saw in the precious metals today was from the selling that we saw in the dollar and the stock market. Last week in the metals we saw a high degree of volatility, trading was orderly in gold and silver today. The talk of some backwardation and the decline of silver stocks continues to support prices, as the March silver contract moved back above the $5.785 resistance area. We could see some follow through buying. The next critical area is $5.88- 5.90, if we break that then $6.00 silver could be the next target. Platinum and palladium, which had seen some profit taking lately, were back to the upside today on reports that no metals were delivered from Russia to Japan, the largest user of paltinum in the world. Will have to see if supplies are forthcoming, if they are, it will put pressure on the platinum and palladium market. Indicators in gold and silver are starting to move up. Seasonally, this is a very weak time of the year for the gold market, but if we do see some cycle inversions, then we could see this market move higher. That is something to watch for over the next few days, and if we can get some follow through buying. Gold gained $2.00 at $293.30, Mar. silver was up .13 at $5.803, platinum gained $4.00 at $378.50. The latest report on the trade deficit was behind the selling we saw in the dollar. The report was favorable, as we saw a decline in our trade imbalance, the monthly figure fell by 11.6% to 8.064 Billion. This was well below expectations of between 9.5-11 billion. When the dollar could not rally with this good news, banks and funds started to sell. When you get good news and the market does not go up, watch out for that market. We are very close to the 100 threshold for the dollar index, if we break that we could see more selling in the dollar. The dollar index lost .98 at 100.18 on the close. The uncertainty of the Asian situation has been a boom for the bond market. Technically the bond market had a positive day as prices reversed up after moving below the 122 area. This reversal will likely encourage more buying overnight, however the market is not clear on the upside yet. We have to get above the gap that we left on Friday which is 123. If we get up above that, the market would be set up for new all time highs. Until prices fill that gap, their will be selling pressure. If the market does gap up in the morning it will leave a nice island bottom indicating that we could be seeing another leg up. Bonds up 9/32 at 122 10/32. As far as the US being the "market maker", I assume that means that the dollar is the worlds currency of choice, with commodities being priced in US dollars.