Saturday, January 07, 2006

Tail Wind For Gold and Silver - Part II

This Friday the USD broke below its 10 month long uptrend line. That is in addition to getting down below its 100 day moving average. The USD is looking awful. This will help gold and silver a lot. Or, is helping gold and silver a lot since they have recovered wonderfully and made new futures highs on Friday.

Another thing that could help gold and silver is a lot of "money" (USD) getting out of the US stock market and looking for a place to go, another bull market to go to. A lot, as in a US stock market crash in 2006. Take a look at these charts:


Some would call the shape of the prices in the last month + a flattening or broadening top. Check your Edwards and Magee (a classic technical analysis book) on this.

The shape of the prices could also be called a megaphone, where prices are taking turns going both up and down. The highs getting higher and the lows getting lower as time goes on. Confusion in the stock market. A dissapation of bullish energy.

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