GOLD UP AGAIN

Gold reached a high of $1,162.80 overnight and silver reached $18.51. Both pulled back from those levels on profit-taking but it now appears that gold has decisively held the $1,150 level and is trading up $2 at $1,155.40 an ounce. Silver is also demonstrating excellent performance, trading at $18.40 an ounce. The dollar is down 15 basis points and oil is up $.32. The Dow Industrials are up 40 points, with the S&P 500 up 5 at 1,202. Breaking out above 1,200 with the Dow above 11,000 seems to be a confirmation of a breakout move to the upside in the equity market also.

Ben Bernanke is speaking today and he has commented that banks have strengthened markedly in recent quarters and that it looks as though the country is in the process of a moderate recovery. He also seems to think that inflation will remain moderate and that there are encouraging signs that employment has turned up. All of these comments paint a fairly rosy picture. However, he says that there are still some difficulties in both the labor market and the economy itself. One of the concerns Bernanke stressed was that there are continuing problems in the housing market. There is some speculation that Bernanke may signal that the Fed may be moving closer to raising rates due to economic improvement. However, so far I have not seen any factors to confirm that. However, he did not repeat his language from the previous Fed statement that rates will remain low for "an extended period."

To be sure, investors and savers need to see some increases in interest rates. Retired people find it almost impossible to live on the income that their savings are generating due to such low rates. In addition, banks will not be encouraged to lend unless rates rise to a point where they can get a more significant return on their loan portfolio. Bill Gross of PIMCO thinks rates will soar. He has reduced his treasury holdings by 40%. Investors need to be somewhat cautious that this may be the calm before the storm. It would not be surprising to see a double dip recession. For that to occur there must be some signs of encouragement that the recession is over before the next shoe drops.

With regard to the gold market, technical analyst Jim Wyckoff says that the gold market remains bullish. The technical momentum is to the upside for the metals markets with support at $1,151 and resistance levels short-term at $1,162.80, then $1,170.70. Once that resistance is penetrated then analysts will be looking at $1,175. Major resistance occurs at the $1,200 level. Some analysts think that $1,200 will be seen in a matter of a few weeks. In addition, the Dow Jones Wire Service reports that the demand for gold is increasing because inflation expectations are increasing.

The CPI rose 0.1% on a monthly basis, which was in line with expectations. But looking ahead, if the economy is recovering, then it seems likely that inflation will jump up into the 2.5% to 3% range fairly quickly. Moreover, over the course of the year, many analysts believe that gold is headed for the $1,300 to $1,400 range. GFMS said that there are indications of strong investment demand in gold. They said investors are still concerned by the long-term threat of inflation and by the possibility that some countries may default on their debt obligations.

Looking ahead there are continuing worries about the debt of the U.S. government and other European governments. Perhaps a more significant concern should be the viability of debt of state and local governments. This could create a significant problem for the financial markets.

Investors who wish to acquire gold or add to their holdings, if appropriate, should contact Goldline at 1-877-341-2646. Ask them to assist you with your gold investing needs. They will also provide you with a free investor package that contains information on investing in precious metals along with articles from major banks, brokerage firms and other important sources. Call Goldline at 1-877-341-2646 now for the free information package.

Investors should ask Goldline to explain the features, benefits and cost structure of the various gold and silver products that are available. Select those that best meet your own personal and individual investing needs and objectives. Investors looking for low transaction costs may wish to consider bullion assets such as American Eagles, Krugerrands, Canadian Maple Leafs, Silver Bags or Silver Bars. However, the Price Guarantee Program is not available with these assets.

If you would like to take advantage of the Price Guarantee Program, which provides you with a window of opportunity in which to re-price your order in the event of a correction, you must select assets with some collectible value such as 20 Francs, Double Eagles and Silver Dollars. Call Goldline at 1-877-341-2646 for further information on the Price Guarantee Program.

To receive the free information package on gold investing, call Goldline at 1-877-341-2646. You will also receive the Client Account Agreement, a company brochure and a Coin Facts Risk Disclosure Booklet. Read these carefully before you make a purchase. Call Goldline at 1-877-341-2646 now to receive your free gold investors package.