Daily Updates

“The Smartest thing said about Silver in a long time”

Posted by Steve Sjuggerud via The Bullion Vault

on Friday, 12 February 2010 15:00

Economic growth doesn’t affect gold and silver prices in the same way…

IT WAS THE SMARTEST thing said on silver that I’ve heard in a long time, writes Brian Hunt, editor in chief of Steve Sjuggerud’s DailyWealth email.

Not surprisingly, Chris Weber said it. He’s as close to an investment oracle as you’ll ever find.

For 39 years, since age 16, Chris has made his living as an investor. To live this sort of life, you have to be a contrarian…you have to be willing to think and do unpopular things. Chris did just that when he told readers of his Global Opportunities Report:

“If the Chinese economy falters, then it is very possible that commodities will fall as well, since China has been a huge market for them.

“I think gold will do better than silver under this scenario, because gold is viewed as a monetary commodity by all the major players, whereas silver is viewed as an industrial metal as well as a monetary one. In a contracting economy, silver may fall. That doesn’t mean I’m going to rush to sell my silver, it means that I am prepared to see silver fall…”

This sort of thing drives some people who hold gold and silver nuts.

There’s a reason gold has been used as money for thousands of years, but it’s easy to get attached to. And many gold and silver owners are very emotionally attached to their gold and silver holdings…much more so than, say, someone who owns 100 shares of Microsoft.

Telling them Gold Bullion or silver could decline in price is like saying their children are ugly.

Chris, like me, believes the price of silver is going to be higher years from now. Governments are in a long-term trend of debasing their currencies, which will send the price of “real assets” like silver much higher. But despite Chris’ bullishness, he doesn’t stick his head in the sand and ignore things that might differ from his thesis.

After all, even the strongest bull markets can trend sideways, or lower, for many months…even years. And a weakening of the global economy could hurt silver because it’s heavily used in industry.

For a picture of how “hurt” silver could get in a correction – and where I expect will be a spectacular buy point – take a look at this three-year chart of silver:

silver_smart_1

Note that if you take out the crazy price action produced by the late 2008 credit crisis, you’ll see that buyers tend to support silver when it trades for $11 to $12 per ounce.

Silver bounced down to this area in August 2008, April 2009, and July 2009. Each time, silver stopped falling.

I believe this is the price where smart, rich investors step in to buy millions of Dollars worth of silver for their “crisis portfolios.” I know several extremely wealthy investors who have this area pegged as a place to buy lots of silver. They see it as the bargain price.

They know a global debasement of currencies will eventually push gold and silver higher…which will overwhelm any short-term considerations. And $12 silver is a cheap way to hedge the rest of your portfolio against currency crisis.

I’m sure Chris’ comments generated some negative feedback from hard-core gold and silver fans. I’m sure this essay will generate some, too. But as investors, we always have to consider the potential risks to our holdings, rather than blindly focusing on the potential rewards. You have to be prepared to see your silver holdings decline in value.

And while I’m bullish on silver, I agree with Chris. If the magical economic recovery the US and Chinese governments have engineered doesn’t pan out, it could temporarily depress the price of silver…even down to $11 an ounce. And as you can see, this would present a terrific buying opportunity for silver bullion and silver stocks.

 

How best to Buy Gold and silver in 2010…? Cut out the middleman, slashing your costs – and your risks – by using BullionVault…

Steve Sjuggerud, 11 Feb ’10

Former stock-broker, mutual-fund vice-president and hedge-fund advisor Dr. Steve Sjuggerud is the founder and editor of True Wealth. Launched in 2001 and now one of America’s best-followed newsletters for private investors, True Wealth also provides free analysis and ideas in the Daily Wealth email service.

Posted by Peter Grandich at 12:15 PM on Wednesday, February 10th, 2010

 

I believe the following 10 stocks have the potential to at least double in price and/or are takeover candidates. I’m highly biased as many of them are either clients and/or I own shares personally.

…..read Peter’s recommendations HERE

…..also great, thorough company Analysis by Peter HERE (Crosshair Exploration)

Have Metals and Stocks Bottomed Yet?

Posted by Chris Vermeulen

on Thursday, 11 February 2010 12:09

Have Metals and Stocks Bottomed Yet?

Everyone is wondering if gold, silver and the indexes have bottomed after last week’s heavy selling. To put things into perspective there were over 30 sell orders for every 1 buy order at the NYSE. That is pure panic and to confirm extreme fear, several of my broker buddies said last week was crazy with clients demanding to liquidate their positions ASAP to be 100% in cash.

This type of sentiment and price movement warns us of a possible market bottom. I am getting the feeling that traders and investors have been expecting this sharp drop I don’t see or feel a large amount of fear in the marketplace. Last Thursday and Friday war crazy but I think we need one more drop to really shake things up before a bottom is set.

Below are some charts showing where the market currently stands and what the charts are pointing to.

GLD Gold ETF Trading – Daily Chart

Gold is clearly trending down on the daily chart. One more thrust down should shake things up enough to trigger the next rally.

1Gold

 

SLV Silver ETF Trading – Daily Chart

Silver has formed a Head & Shoulders pattern and has broken through multiple support levels. A measured move to the down side would be $14 for silver which could happen in the coming days.

2Silver

 

SP500, NYSE, GOLD Futures, US Dollar Index – Intraday Charts

These charts clearly show the price action of the past month. As you can see the trend of stocks and gold are down with consolidations (pauses). This is the exact reason why you must trade with the trend and not do counter trend trades. Bounces are more like sideway movements making it very difficult to try and play bounces in a down trend.

If you focus on selling at key resistance levels then moves tend to be much more profitable. That being said, we did go long last Friday because of the extreme oversold market level. I was expecting a follow through Monday or Tuesday which has yet to happen. We have now moved our stops to break even or better to eliminate our down side risk.

3IntradayTrading

 

Spot Gold 24Hr Trading Chart

This chart says it all. The market and gold is very volatile making it difficult to trade right now. Bulls and bears are battling it out. Only time will tell!

4GoldFutures

 

Stocks & Commodity Trading Conclusion:

In short, it’s been a slow week without any real exciting moves. Thursday and Friday could be interesting if traders exit their positions going into the long weekend in order to protect themselves from any surprise economic news.

From the looks of gold, silver and the indexes I sense selling could be just around the corner. We are currently long a few positions with our stops are break even or better in hopes for a pop and rally going into the holiday weekend but only time will tell.

My wife and I have our first child due on Saturday so I may disappear for 1-2 days in the coming week as we welcome our little princess into this new and exciting world.

If you would like to receive my FREE trading reports directly to your inbox please visit my website HERE

 

My name is Chris Vermeulen, founder of TheGoldAndOilGuy newsletter. I provide you with unparalleled trading newsletter with charts, signals and email support. Unlike other investing newsletters, I’m a one man show. That’s because I don’t want some hired hand giving you advice while I take it easy on a beach somewhere. You ALWAYS get precise, valuable information DIRECTLY from ME.

IN THIS ISSUE OF LUNCH WITH DAVE

Lunch with Dave

• While you were sleeping — the intense risk aversion of the past week is fading; we are 2½ years into the global credit crunch and investors are still salivating over bailout prospects

• Market commentary — in our view, the stresses in the private sector in the U.S., especially the mortgage market, are still in place; the good news is at least the balance sheet of large-cap businesses are in reasonably good shape

• The call for bonds — the share of the debt pie 10 years or longer in the U.S. is at a 30-year low …

• … yet, sentiment on bonds quite negative — JPM survey of fixed-income investors showed that 27% of the respondents are bearish on bonds

• U.S. small business sentiment still at low levels

• No hiring — the NFIB survey noted that job openings remain near all-time lows; the JOLTS survey also shows that there continues to be no hiring in the general economy

• Revisions to the U.S. Q4 real GDP already to the downside

• New truck index in reverse

…… lunch with Dave Full Article HERE

……lunch with Dave Lite HERE

First – Claus Vogt

“In last week’s Money and Markets column, I told you about some stock market indicators to watch.

Since then, the market has fallen even further. So today I want to update you on what’s happening now, and what I think about the additional weakness in stocks.

The main question we need to answer …

Is This the Start of a New Bear Market
Or Just a Typical Correction?“

“Volume picked up considerably on Thursday and Friday, with Thursday’s down volume representing 97.3 percent of total volume. These are clear signs of panic.”

Momentum indicators also fell to oversold levels. And market breadth was very lopsided, with breadth-based indicators flashing deeply oversold levels.

Finally, sentiment indicators show that a fair amount of angst has returned to Wall Street:

In January, the American Association of Individual Investors showed 48 percent bulls and only 22 percent bears.

As of February 4 this picture has totally changed, bullish sentiment is down to 29 percent and bears are up to 43 percent.

Plus, this survey was taken before Thursday’s and Friday’s market action.

Other sentiment indicators are confirming these bearish readings. For instance, at 1.21, Friday’s CBOE put-call ratio was high.

All of this tells me that we’re witnessing a correction, not the beginning of a new bear market.”

OR

 

Richard Russell of the Dow Theory Letters –

” In an effort to escape the pain of an ongoing primary bear market, the US under the auspices of Fed Chairman Ben Bernanke, our reigning expert on the Great Depression, has built the greatest edifice of debt the world has ever seen. Debt can be useful under the capitalist systems, and I mean debt up to a point. But there is a level above which debt becomes a great danger to the individual and to the nation. I believe we are there. We’ve been taken over by insane, unsustainable debt. The bright spot (if there is one) in the picture is that the Fed has held short interest rates to zero. So far, the cost (interest) on the national debt has been held to “a current minimum,” of around $700 billion a year.

But now the talk and the pressure is on the Fed and the administration to boost their zero interest rates and to cut back on stimulus programs and unfettered money creation. Cutting back on money creation and stimuli could have the effect of plunging the US back into increased recession. Continuing on the same path will further increase the national debt. Rising interest rates will have the effect of heightening the ominous compounding effect on the national debt.

“Another warning, please be out of common stocks”

“Remember my rule — our job now is to lose as little money as possible. And keep your day job if you have one”.

….more HERE

 

Richard Russell has made his subscribers fortunes. One of the best values anywhere in the financial world at only a $300 subscription to get his DAILY report for a year. HERE to subscribe. Amongst his achievements Richard was in cash before the 2008/2009 Crash and he has been Bullish Gold since below $300

Ed Note: Richard Russell is bullish Silver and holds one of the largest single positions he has held since the 1950’s in the precious metals.

 

Claus Vogt is the editor of Sicheres Geld, the first and largest-circulation contrarian investment letter in Europe. Although the publication is based on Martin Weiss’ Safe Money, Mr. Vogt has provided new, independent insights and amazingly accurate forecasts that, in turn, have contributed great value to Safe Money itself.

Mr. Vogt is the co-author of the German bestseller, Das Greenspan Dossier, where he predicted, well ahead of time, the sequence of events that have unfolded since, including the U.S. housing bust, the U.S. recession, the demise of Fannie Mae and Freddie Mac, as well as the financial system crisis.

He is also the editor of the German edition of Weiss Research’s International ETF Trader, which has delivered overall gains (including losers) in the high double digits even while the U.S. stock market suffered its worst year since 1932.

His analysis and insights will be appearing regularly in Money and Markets.


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