The terminally ill U.S. Dollar is trying to remove itself from its respirator for a while. Record low bullish sentiment in the Forex pits combined with it brushing up against the top of a clearly defined downtrend suggests it needs careful watching for the short term at least. A close above the 50-Day M.A. around 78 would be the first real sign a counter-trend rally is underway. Any such rally should be held around the 200-Day M.A. in the 82 area.
Tomorrow’s employment number could be the ignition so stay tuned.
ok so what does this mean for gold? are the two not attached as one goes up the other goes down? how should i play this as i have the majority of my portfolio in gold?
Peter,what short term impact do you forsee a dollar rally having on gold?more importantly gold stocks?thank you.
Ryan, the following might help us answer that question as it was posted by Peter on Monday of this week. My read on this is that our gold holdings may well be negatively impacted at least on a shorter term basis:
Posted by Peter Grandich at 4:40 PM on Monday, September 28th, 2009
“We could be “finally” seeing the makings of a U.S. Dollar rally. Some sentiment indicators are so oversold and with bullish sentiment among dollar traders in the single digits, one can’t but help think there’s a rally in here somewhere.
This by no means changes any of my long-term outlooks but can come into play on the metals and energy side of things for the very near-term.
The combination of this and what’s looking more and more like a self fer-filling prophecy of the usual Commercials smashing the speculative longs on the Comex, could cause a very short-term shake out in gold. But with Physical buying so strong, any shakeout should only last as long as real hopes of the Vancouver Canucks winning the Stanley Cup.”
I have the same question.
Worse will be if stock market also sells off, how will gold stocks survive if gold as well as market sells off.
Hopefully today’s market downturn is a one day event.
thanks susan. i guess ill just have to hang tight. o but btw the canucks will win a cup soon:P
The question for you is:
Is your gold a trading vehicle or a long term hold? If the latter, buy on dips, if the former…
Roger.
Ryan, one additional comment. Mark Leibovit did an update recently mentioning the activity in the dollar. He believes the dollar is moving up on the flight to safety given today’s less than stellar economic news, the decline in the stock market, and Romania’s government collapse. At the time he gave his update this a.m., the US Dollar Index was up 0.421 to 77.074.
He then also discussed the PM indicating that they were holding up well in the face of the strengthened $. Gold was down at that time 4.90 to 1002.80 and silver down 0.02 to 16.60.
Any good websites that anyone uses to track the dollar?
What does “Any such rally should be held around the 200-Day M.A. in the 82 area” mean?
David A.,
Moving averages (M.A.), in this case the 200 day, provide support and resistance.
I believe Peter is saying he does not expect any dollar rally to go higher than 82 or thereabouts.
Roger
The goldbugs around here are getting nervous.
No surprise the dollar’s looking like it’s bottomed. Dollar bears, especially American ones, rarely seem to consider the other side of the issue: if you expect the dollar to go down to new lows, what forces are in play that will drive other currencies up? You can’t have a rise in the other major currencies when most of them are afflicted with the same problems the US faces – massive debt, budget deficits, recession, persistent credit problems, rising unemployment, low corporate profits, aging populations, looming pension shortfalls, etc.
The Yen is a basket case – Japan may be headed for bankruptcy. The Eurozone has all the problems listed above, plus no effective central bank to coordinate policy. Canada’s in good shape and has the only banking system that sailed through the credit crisis with no bailouts required – but it’s still in recession, the federal government is back in deficit-land, and the value of its oil reserves has already sent the Cdn$ on a tear. China’s still growing, but its growth is overstated and the government is engaging in massive stimulus to pump up domestic consumption and compensate for export losses (the renminbi doesn’t trade freely in any case).
Goldbugs have to realize that a sustained rise in gold would probably require loss of confidence in currencies and inflation in all major economies, not just the US. But inflation isn’t happening right now – prices are falling in most countries. Deflation is still the big problem, as it has been since the beginning of the credit crisis. The $trillion stimulus has not sent prices up (though it appears to have put a floor under the housing market).
A double-dip recession is still very possible – if it happens, it’s deflationary. The debt-driven inflation scenario, which the goldbugs rely on as the main rationale for buying gold, may take several years to materialize. In the meantime, gold could easily trade sideways, and wipe out the capital of overeager gold traders.
Sorry to make my first post a question, but Susan I was going to ask you the same thing, what site you use for current US$ index price and charting (and for commodities like gold, oil, natgas etc.)? I mainly use stockcharts.com but for some reason it doesn’t give current day / intraday information for US$ index or commodities. Searching a bit today I found CNBC has intraaday charting of US$ index here:
http://data.cnbc.com/quotes/US%40DX/tab/2 but, may-be there is something better out there.
NAK/NDM Negative article – Now why would Tiffany boycott this project?
See article below:
GOLD NEWSTIFFANY URGES OTHER JEWELERS TO OPPOSE PEBBLE
Anti-Pebble gold movement grows among U.S. jewelry manufacturers
Eighteen jewelers representing billions of dollars in annual sales have vowed not to use gold from the massive Pebble copper-gold project near the Bristol Bay fishery in Alaska.
Author: Dorothy Kosich
Posted: Thursday , 01 Oct 2009
RENO, NV –
As Tiffany & Co. ran an ad urging its peers to join the boycott against the use of any future gold mined from the Pebble Gold project in their jewelry, two of the nation’s largest manufacturers of class rings agreed to reject Pebble’s precious metal.
Four more jewelers with nearly $1 billion in sales joined the 14 jewelry companies now opposed to Pebble’s development near the sport fishery of Bristol Bay, Alaska.
Herff-Jones, Commemorative Bands, Birks and Mayors, and Hacker Jewelers have joined other retailers, including Tiffany and Helzberg Diamonds, who have vowed not to buy gold from the Pebble mine.
In an industry advertisement aimed at jewelers, Tiffany said it objects to the proposal “to build an enormous gold and copper mine in the very heart of Alaska’s Bristol Bay Watershed, home of the world’s most productive salmon fishery.”
Tiffany contends that “there are certain places where mining cannot be done without forever destroying landscapes, wildlife and communities. Bristol Bay is one such place.”
In a news release, environmental NGO Earthworks said the mine will generate “billions of tons of mine waste and using 35 billion gallons of water per year-about the same amount as the City of Anchorage.”
The Pebble Partnership-comprised of Anglo American and Northern Dynasty-did not respond to Mineweb’s request for comment by our deadline early Thursday morning.
In an e-mail to Mineweb Wednesday, Tiffany CEO Michael Kowalski said, “We have been opposing the Pebble mine in every public forum we have spoken at – the FT and Fortune Green conferences, the EMA awards in Hollywood.” Kowalski said Tiffany & Co. has discussed its objections to the Pebble Project with Anglo American.
As a gold bug – since other call me that – I don’t know that this is such a bad thing. Long term outlook remains the same in the face of all this economic data. In my opinion it looks like a great buying opportunity should it negatively impact gold and silver prices. But, looking right now the metals in my opinion are holding fairly strong. $1001.70 for gold and $16.52 for silver right now.
Susan, do u find your investment in VR Trader worth the money? I’m looking for an additional source of info. Thanks
Hal (GT),
I agree.
MANY would like to see lower gold/silver prices to buy in.
Remember that last year when silver was cheap, you couldn’t find any (physical in the form of coins) for sale at those rock bottom prices.
We still may see premiums rise as the metal falls preventing value purchase again but we can at least be hopeful.
Roger.
susan,
not sure if you somebody posted link to track usd dollar index
check http://www.weblinks247.com/indexes/idx24_usd_en_2.gif
Susan,
I usually try to keep tabs while at work with link…
http://www.ino.com/?af
To fully appreciate how foolish and desperate the anti-pebble crowd is, there’s no way to know what mine gold came from for retailers. All these stores are doing is catering to the tree huggers knowing their offer has zero ability to succeed. But it gets them press which in turn keeps them getting funds.
how would tiffany or any one else know who mined the gold they bought ?
Norm, VR Trader is expensive and unless you are a frequent trader (I mean daily and often several times within the day) it could well be a wasted resource. I most likely will not renew my subscription when its up because of this reason. He may for example, move into VTI one day and then out another – and if you don’t always check your emails you could miss that. That said, I believe according to his website that he does have a good record.
You may want to consider getting Hulbert Digest subscription as they rank the newsletters and give you the actual performance numbers for one year, five years, etc. Examples include…..International Harry Schultz Letter had 58% return for one year and 5.5% for 5 years (annualized); The Ruff Times had 55.7% return for one year and 6.1% for 5 years (annualized). It also compare the newsletters to see which beat the Wilshire 5000 total return index. Just some thoughts for your consideration.
Rubin….thanks!
Tom, I like that site….has lots of information within one screen. thanks…saved it to favorites
For Sauan,
Go to Equities Stock Indexes for a great U.S.D.Chart. Reguards, Lynn
Roger,
thanks for clearifying that.
Much appreciated.
Be careful of market gold should go to 920 930 and rocket up again
Susan, There also is http://www.kitco.com or http://www.321gold.com
Gold is in a very technically bullish pattern. It doesn’t seem to have much downside. Every dip may become a buying opportunity.
http://seekingalpha.com/article/164373-breakouts-in-gold-and-natural-gas
Lynn, do you have an actual website for that? I am really liking all these suggestions and thanks to one and all for the many suggestions which i have added to my favorites.