Fibonacci Financial

Posts Tagged ‘GLD’

Yes Dear Reader, Silver and Gold rallied after the COT Sell Signal.

One of the advantages of following the COT reports is to help determine which breakouts are the beginning of a new trend and which are not.  With the COT reports providing a sell signal on Silver, I give this rally low odds.

Also, The Commercials (insiders) set up their positions early and against short term trends.  Patience, patience

The odds still favor a failed rally attempt in the precious metals and not the start of the next major leg up in a bull market move.

FYI – while Gold and Silver represent a significant part of the Core holdings in our portfolio right now, they were acquired at substantially lower prices.

What Are All Those XXXX’s and OOOO’s on the Charts?

( No Dear Reader They Don’t Represent Hugs n Kisses! )

Several readers have indicated that they are not familiar with the point and figure charts that I use for illustration purposes in the blog.  John Murphy (world class technical analyst) provides an excellent overview of Point and Figure charting on his web site StockCharts.com.  If anyone is interested in why I use these “old fashioned” P and F charts drop a comment requesting additional information.

Do not get the idea that you can trade or make investment decisions from my blog entries.  These are an introduction to my services and do not constitute investment advice.

The Inflation vs Deflation debate rages all over the Web – So who is right ?

Last years deflationary collapse was revealed by a break out of a 2 year consolidation of the Gold/Silver ratio.  After burning itself out temporarily and yielding to the current mini bail out bubble the Gold/Silver ratio has once again entered a consolidation formation.  The breakout should indicate which tide will overwhelm the markets over the next 9 to 18 months.  My guess is that you will not find this insight anywhere else on the web.

Vide !

How does this work?  Silver was demonetized a century or so ago and now a large part of its demand comes from the industrial/jewelry sector (although the monetary demand is growing again).  Therefore it is more sensitive to a deflationary collapse.  Although the central banks and governments of the world have worked tirelessly to demonetize gold, it still is part of the monetary base of most central banks.  In spite of blatant manipulation by central banks and governments it still is less sensitive to deflation.  If the Bernanke/Obama bail out/stimulus printing presses overwhelm the collapse of toxic debt and we head into another inflationary/hyper-inflationary period, gold and silver will both break out to new highs but silver will run faster.  As the price of silver outpaces gold on a relative basis, the Gold/Silver ratio will decline.

Why should you care dear reader?

The next tide of either Inflation or Deflation will have a massive impact on your investments and wealth.  Knowing which one will dominate should dramatically alter the composition of your investments and impact your financial decisions.

The Gold/Silver ratio is one of the key indicators that I watch.

We don’t have to guess or predict the outcome of the Deflation / Inflation tug-of-war.  We just have to be alert to what the markets are telling us and reallocate our portfolios accordingly.

You saw it here first.  So, Stay Tuned ! ! !

In previous Financial War Room posts a potential decline in Gold and GLD was spotlighted starting on April 5th. Here is an updated chart showing progress of the decline to date.

The original breakdown below 88 (sell signal 1) has been followed by a break of the 45 degree (blue) trend line (sell signal 2). A print of trading at 84 will constitute sell signal 3. The Buy me box shows the approximate range I expect GLD and Gold to begin to look attractive for accumulation again. This is not a slam dunk though. I will be looking at several other tools if we get to this buy range such as Commitment of Trader activity. Stay Tuned For More.

At the appropriate juncture the FF Market Decision Model will flash a Green Light for GLD and Gold.

To participate in this multi year Golden Opportunity with detailed instructions and guidance, drop me a post.

PS: If you found this valuable or interesting PLEASE let me know by dropping me a post !

Well we nailed that one Next Stop below $700 on Gold

Tighten your seat belt and fasten your harness! Gold is about to tank.

And a NEW way to participate. Forex.com has added an exciting new currency pair XAU:USD.

I love the smell of fire sales in precious metals in the morning!

GLD the Gold ETF is ready to break down on a Point and Figure chart. Once the GLD chart prints a trade at 87 gold should be sold. The Commitment of Traders report the last month or so has indicated that speculators have spent there wad and there is not enough money to drive Gold to new highs. Long term support should be between $600 and $700. When Gold get down into this region of course I will be watching the COT activity very closely for commercial accumulation. For long term investors and accumulators this will probably provide a multi-year buying opportunity.

If, you have a portion of your portfolio commited to speculation and you have the requisite experience, there is a new oppotunity out there. Forex.com now offers a gold/dollar currency pair. The XAG:USD can purchased or sold short for only around $200 a contract – check it out! This $200 dollars controls 10 onces of gold. So, a drop from $870 to $650 will provide a profit of around $2,200 dollars ( $220 dollar drop in gold X 10 ounces equals $2,200).

More golden nuggets from your intrepid investment advisor,

MRS

This doesn’t constitute investment advice; but is presented as educational information. This will give you a flavor of the investment management opportunities of working with Fibonacci Financial.

For personal financial planning and asset allocation consulting services email me at:

michael@fibonaccifinancial.com

Fire Sale Soon

There is a Gold(xau) and Silver(xag) fire sale coming soon!

This will be the best time to accumulate gold and silver for several years to come.

Will you be ready? Preparation and Planning will significantly add to your net worth.

Take Action Now

Questions ? email me at: michael@fibonaccifinancial.com