Blog

June 8, 2009 – We can now see with the benefit of hindsight how important support was in the 68-69 area for the gold/silver ratio. When this support level finally gave way, the ratio sliced right through it and continued to tumble lower, with silver outperforming gold. This outperformance is important. It means that moneyRead more

June 8, 2009 – My comments are the same as the last letter. With each passing day, December’s top in prices (i.e., low in yields) looks more and more certain. I don’t recommend that traders chase the T-note lower. I do not though have any specific recommendations at the moment as to when to enterRead more

This past Tuesday the Dollar Index made a closing low of 78.40, which was a whopping -6.6% drop from our short sale price in only twenty trading days. The dollar literally collapsed, so it is not surprising that the dollar finally bounced somewhat toward the end of the week.

I continue to recommend that investors stay out of the stock market (except for my recommended stocks). Continue to hold ‘gold-cash’, not ‘dollar-cash’, thereby keeping your money safe and sound in bullion until stock prices fall to more reasonable levels when measured in terms of gold. I do not have any trading recommendations at the moment.

A number of key factors have fallen into place over the past couple of weeks. Unfortunately, together they increase the probabilities that the US dollar is headed toward hyperinflation.

It has taken a lot of patience, but the gold/silver ratio finally sliced through support at the 68-69 area. The ratio has clearly broken down, meaning that silver is now outperforming gold.

Silver has rallied above its 200-day moving average. It is now contending with resistance at the horizontal red line drawn at $15, which is a dividing line between overhead resistance and underlying support.

May 25, 2009 – Our patience is finally being rewarded. The precious metals are on the move, and higher prices are likely in the weeks ahead. While for months there has been every reason to be bullish about the prospects for both precious metals from both a short-term and a long-term point of view, weRead more

May 25, 2009 – I would like to get short again, but the T-note did not bounce up to the level I was looking for. It was a sign of weakness, and we have now seen that weakness play out as T-note prices have collapsed. It would not be unreasonable to sell short here, butRead more

May 25, 2009 – Since March 23, 2001, we have been holding goldgrams as our Core Currency Position. On May 4th traders sold the US dollar by shorting the Dollar Index at 83.97. Stop out this trade if the Index closes above 82.80. Since establishing this short position, the dollar has dropped 4.8%, which isRead more