GOLD FALLS BELOW SUPPORT

Gold sold off heavily last night on worries that the International Monetary Fund plans to sell 400 tons of gold. That actually is old news, nevertheless it was the excuse given for today's sell-off. I personally think the sell-off is related to other factors. Part of that, I think is a technical situation where gold was unable to hold at key support levels. Gold has now broken below the $880 level, ending the consolidation within the most recent trading range and opening the door to further liquidation. Some analysts believe that the stock market has put in a bottom and that the need for gold as a safe haven asset has diminished. In my view, that is highly unlikely and that is the view of B of A/Merrill Lynch's analyst David Rosenberg and others.

With gold now trading below $880, the question is – is the bull market intact? There is absolutely no question that it is.If you look at the data coming from technical analysts, the Aden Sisters and others, gold could fall back from these levels and yet it is still in a major bull market. This is simply another one of those dramatic corrections that test the fortitude of the bulls. Bull markets operate in a way to shake off the weakest holders. That seems to be what is going on at the moment. I suspect there is a possibility of testing the $850 level, which should hold. Nevertheless, since one never knows where the bottom is in these bull market corrections, it would be foolhardy to try to time the exact low for the correction. Rather, I think it is wiser to look at the overall fundamentals of the market and arrive at a conclusion as to whether you think gold will be back above $1,000 in the next several months. According to the majority of analysts, it certainly is likely that gold will rally above $1,000 and perhaps to the $1,100 or $1,200 range by year-end. Therefore, as long-term investors we should be accumulating at these levels.

The dollar is particularly strong this morning, gaining 23 basis points, which is further pressuring the gold market. Analysts from Royal Bank of Canada said despite the pressure on gold over the short-term, don't expect the declines to morph into a long-term down trend. They said as the safe haven aspect of the gold trade is eventually worked off, the inflation hedge part of the trade is to become more dominant. When we look at safe haven demand for gold, one has to also look at the question of just how safe the equity market is. In my view, it is not very safe at all.

Another factor that may be influencing the market is that there seems to be a lack of reaction to North Korea's launch of the missile test. Other factors that would normally influence the markets are also absent today.

Deutche Bank said a weaker dollar due to quantitative easing in the U.S. means, "The next three months offers the best opportunity for gold prices to rally, reflecting our view that euro/USD is set to move forward (to) 1.50." The Wall Street Journal pointed out, "Gold sales by the International Monetary Fund are unlikely to depress the metals price because central banks would be likely buyers." They said further, "Analysts said that if the sales go forward, they would be slow, orderly and absorbed by central banks … central banks such as those in China, Russia and Japan are obvious counter-parties to this kind of sale, said Morgan Stanley analyst Hussein Allidina."

Before any IMF sale happens, 85% of the funds shareholders need to approve the proposal. Since the U.S. has 17% of the votes, it has a de facto veto over the proposal. The U.S. Congress has never been willing to approve such sales. The Wall Street Journal said, "There are strict rules over how gold would be sold by the IMF. On its website, the IMF said approval would be granted only if the sale could be conducted in a way to minimize disruption to the gold market."

Given the restrictions on sales and given the fact that they would be sold pursuant to the central bank gold sales agreement, I think this business of IMF gold sales is really not moving the market other than as an excuse for a sell-off. The reality is even if they do decide to sell the gold it would be no different from anything that we've seen over the past 10 years. The agreement to sell 500 tons a year has been in place since 2001 and these sales have occurred every year. Nevertheless, gold prices have continued to move up and have in fact tripled since the first gold sales agreement was put in place.

Therefore, there are those who view today's correction as merely another technical correction and pull back within the context of a major bull market. I continue to view this market as a buying opportunity. Those who would like to take advantage of this buying opportunity should call Goldline at 1-877-341-2646 for assistance getting started. With the nervousness in the market, investors may wish to utilize Goldline's Price Guarantee Program. This program provides a two-week window of opportunity for investors to re-price their transaction to get more gold or silver for their money if the market should fall. Consequently, it is a helpful tool. However, remember gold is a long-term diversification in one's overall portfolio. Ask yourself, where else is it safe to put money where I can have confidence that it will buy the amount of goods and services 10 years from now as it does today? The only asset that offers that kind of benefit is gold. Moreover, gold is clearly the best form of money and has been for thousands of years. It is unlikely that will change. Call Goldline today at 1-877-341-2464 for assistance adding gold to your holdings to take advantage of the corrective move.

You should also ask Goldline for the free information package, which contains articles discussing the replacement of the dollar as the world's reserve currency, along with articles forecasting future gold prices and the devaluation of the U.S. dollar. Call Goldline for the free information package at 1-877-341-2646. Tell them "Joe said to call," so you can get a free copy of the CD interview I did with Frank Barbera and a copy of the American Advisor Newsletter, a $25 value for free. Call Goldline at 1-877-341-2646.

Investors should contact Goldline and ask them to explain the features, benefits and cost structure of the various gold and silver investments 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 two-week 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, including articles on the dollar, the economy and gold, call Goldline at 1-877-341-2646. Goldline also provides several other helpful articles. There are a number of other independent third-party source articles that you will find extremely helpful and informative. You will also receive the Client Account Agreement, a company brochure and a Coin Facts Risk Disclosure booklet. Read these carefully before you make an investment. Call Goldline at 1-877-341-2646 now to receive your free information package.