|
GOLD
& SILVER: BARBAROUS RELICS OR THE REAL DEAL Gold Gold closed the week up 27.30 to 842.70 for a +3.35% gain. Not bad for a barbarous relic. The daily chart below shows a break above the upper trend line of the symmetrical triangle that has been forming since November. MACD made a positive cross over, which appeared to be setting up last week. RSI is headed up towards the 70 level (66.88). Histograms have gone into positive territory and are headed up. The second chart below is the daily GLD, which pretty much shows the same scenario as gold’s daily chart. Note, however, on GLD’s daily chart that volume has been decreasing during the recent move. It would be more constructive if volume had increased…
Silver Silver was up 0.41 to close the week out at 14.90 for a +2.81% gain, underperforming gold somewhat. The weekly chart shows silver above its 50 day moving averaging and bumping into overhead resistance. RSI has turned up, and MACD did not put in the negative cross over that appeared to be setting up last week. Histograms have turned positive. Price needs to break above the red horizontal resistance line.
Hui Index The Hui Index closed up 15.45 points to 414 for a +3.88% gain, slighter more than physical gold’s advance for the week. The daily chart below shows the Hui breaking above the blue horizontal resistance line at 401-402 with its weekly close at 414.00. Back in September this level was resistance, which was then broken through and turned to support, as the index went on to new highs. It then closed below the support line in December, which then became resistance. Last week the index broke above the same level. So it’s been a back and forth tug of war. So far it’s a bullish pattern of higher highs and higher lows, which is the reason why gold stocks were one of the top performing sectors in the market this year. MACD still shows a negative cross over and histograms are negative as well. MACD appears to be flattening out and may be about to turn up. The beginning of 2008 will be interesting. The bullish trend remains in place until it isn’t. As of now it is.
The daily Hui chart shows price breaking above its upper trend line and its 50 day moving average (412.45). RSI is above 50 and headed up. Last week’s report showed price below its 50 dma and suggested that a positive MACD cross might be setting up. MACD did in fact turn up last week and made a positive cross over. Histograms turned positive as well.
GDX The GDX was up 1.25 points to close at 46.63 for a +2.75% gain. Price closed above its overhead resistance line and its 50 dma as well. RSI is above 50 and headed up. Last week’s report mentioned that the histograms were slowly improving and that MACD was flattening out and may have put in a bottom. MACD put in a positive cross over and the histograms also turned up and positive. Note that volume is trending down on the recent move. Rising volume will be needed to sustain the move.
Xau/Gold Ratio The Xau/Gold Ratio is now turning up. It is not unusual to see physical gold out perform the gold stocks for sustained periods. When the gold stocks move, they can move very sharp and violently – and fast, both up and down. They are very capable of making up a lot of ground in a short amount of time, as the second chart shows.
Individual Stock Charts The major players seem to be performing best. Included are SLW, KGC, GG, and AEM. There are others. Below are GG and AEM. Disclosure: I own positions in the first three.
Goldcorp has broken above its overhead resistance line and its 50 day moving average. It closed up just shy of 4% for the week. RSI is head up and MACD put in a positive cross over. Histograms have turned up as well. Agnico Eagle Mines closed up 5.94% for the week. RSI is headed up strongly, as are the histograms.
Happy New Year to all and may peace come to all shores. Good luck. Good trading. Good health. And that’s a wrap.  © 2007 Douglas V. Gnazzo Editorial Archive All
rights reserved. Any republication without written permission CONTACT
INFORMATION About the author: Douglas V. Gnazzo writes for numerous websites and his work appears both here and abroad. Just recently he was honored by being chosen as a Foundation Scholar for the Foundation for the Advancement of Monetary Education (FAME). Disclaimer: The contents of this article represent the opinions of Douglas V. Gnazzo. Nothing contained herein is intended as investment advice or recommendations for specific investment decisions, and you should not rely on it as such. Douglas V. Gnazzo is not a registered investment advisor. Information and analysis above are derived from sources and using methods believed to be reliable, but Douglas. V. Gnazzo cannot accept responsibility for any trading losses you may incur as a result of your reliance on this analysis and will not be held liable for the consequence of reliance upon any opinion or statement contained herein or any omission. Individuals should consult with their broker and personal financial advisors before engaging in any trading activities. Do your own due diligence regarding personal investment decisions. This article may contain information that is confidential and/or protected by law. The purpose of this article is intended to be used as an educational discussion of the issues involved. Douglas V. Gnazzo is not a lawyer or a legal scholar. Information and analysis derived from the quoted sources are believed to be reliable and are offered in good faith. Only a highly trained and certified and registered legal professional should be regarded as an authority on the issues involved; and all those seeking such an authoritative opinion should do their own due diligence and seek out the advice of a legal professional. Lastly Douglas V. Gnazzo believes that The United States of America is the greatest country on Earth, but that it can yet become greater. This article is written to help facilitate that greater becoming. God Bless America. The opinions of FSU contributors do not necessarily reflect those of Financial Sense. |
