The correction in
precious metals continues today in spite of the fact that the dollar is trading
at about unchanged and oil is up $.23 to $66.12 a barrel. Dow Jones Wire Service said: "Spot gold is
trading lower, testing support at $985 a troy ounce after the dollar
strengthened following poor U.S. durable goods data ...' if gold trades below
$985/oz next support is at $980/oz. Below
that could trigger sell stops in the market."
Clearly, gold has excellent support at the $985 level and it is unlikely
to trend below that. That comment was
written earlier in the day when the dollar was trading at a high of
$77.07. While a stronger dollar got the
metals moving down, once gold broke below $995, it then opened the way for a
test of support at $985. That support
level held nicely. In fact, I would not
be surprised to see gold rally considerably from where it is now. In addition, we have end of week profit
taking and end of quarter profit taking occurring in the market as well. In other words, some see this as just a
technical correction and a buying opportunity.
Gold is giving
investors who missed out on the chance to acquire it under $1,000 another
opportunity to do so and gold offers more potential gains than it did just a
few days ago. Yesterday afternoon, Bob
Haberkorn, a senior market strategist with Lind-Waldock said: "It's a healthy
correction. We were a little overbought
and were not able to make new highs in the gold market. We had some profit taking based off of
strength in the dollar. ...' Still, the
chart remains constructive for gold.
The tune in the market has not changed it's still a bullish chart
pattern. I think this downside move
will bring a new wave of buyers into the market for both silver and gold." Reported Dow Jones Wire Service.
Durable goods
orders fell 2.4% in August, when they had been expected to rise 0.3%. That was one factor that clearly influenced
the markets this morning. This was the
largest drop in durable goods orders in seven months, largely due to lower
aircraft demand. The Reuter's
University of Michigan twelve-month inflation forecast is 2.2%. The five-year inflation forecast is for 2.8%. August new home sales rose 0.7%, which was
less than expected. However, do not
overlook the fact that there is a huge overhang of shadow inventory in the
market.
As the day wears
on, I think other factors will also help improve the picture for the precious
metals. For example: on a geopolitical
note the U.S., France and the UK accused Iran of building a covert uranium
enrichment facility. They said that
Tehran is directly challenging global nonproliferation rules and putting more
pressure on high stakes talks scheduled for next week. Dow Jones Wire Service reported: "The
existence of this facility underscores Iran's continuing unwillingness to meet
its obligations under U.N. security counsel resolutions. President Barack Obama said in brief comments
at the G20." Israel also responded with
remarks that indicated that this will not be tolerated. The fact of the matter is, that this could
be pointing to a potential for further conflict in the Middle East. If that were to occur, it is possible that
Iran would seek to close the Straits of Hormuz, choking off oil supplies as
they did in the 70's and this could drive gold prices dramatically higher. It would also add fuel to the inflationary
fire. Higher oil prices, combined with
a falling dollar would clearly have a positive impact on the gold market based
on what we saw in the 1970's.
There are many
reasons to view today's correction in gold as a great buying opportunity. To take advantage of that opportunity, call
Goldline at 1-877-341-2646. Also, ask
Goldline for the free gold investor information package and a free copy of the
Peter Grandich interview on CD.
Investors should
ask Goldline to explain the features, benefits and cost structure of the
various gold and silver investments that are available to you. 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 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 an investment. Call Goldline at 1-877-341-2646 now
to receive your free information package.
You should carefully read Goldline's Account and Storage Agreement and our risk disclosure
booklet, Coin Facts for Investors and Collectors to Consider. These provide important
information that you should consider before investing in precious metals. Goldline's spread,
which is the difference between the price we sell our products and the price we buy them back,
generally ranges between 5% to 20% on our most common bullion products and 30% to 35% on all
other products including our popular semi-numismatic coins such as the European francs, proof
coins and graded coins. The market must go up enough to overcome this spread before an actual
profit is achieved. All markets go up and down. Past performance does not guarantee future
results. Coins are a long-term, three- to five-year, preferably five- to ten-year investment. We
believe precious metals are suitable for 5% to 20% of the average portfolio though others may
recommend a different percentage. Please see Goldline's risk disclosure materials for additional
information.
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