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In the short run, I see immediate support for gold at US$1,260.00 an ounce and immediate support for silver at US$20.20 an ounce. Gold is now challenging resistance at US$1,270.00 and if it does break this, it could go much higher.
On 20 June 2010, I blogged that "if we believe in charting, silver's longer term trend is still up and I would buy more on weakness." That view has not changed.
Related post:
Hedging and precious metals.
Gold hit $1,269.45 on the London Bullion Market on Tuesday afternoon, beating the previous record of $1,265.30 struck on June 21. Read article here.
Addition on 15 Sep 10:
Gold prices under the continuous contract set a new all-time high of $1274.60 per ounce, well above the previous all time high of $1266.50 per ounce. Silver prices continued their ascent as well. Specifically, the December contract for the precious metal hit $20.55 per ounce.
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2 comments:
Hi AK,
Recently, penny stocks have seen the rise in volume again, and i am wary of this phenomenon, when penny stocks start to see huge volume, and rising everyday. I take it as a mean of overbuying, and lots of speculative money. How do you view this phenomenon?
Sorry but dont know where to post this question.
Hi Paul,
Hey, you can place your questions anywhere. I will find them. :)
There are two camps out there with one talking about the global economy being on the mend and one talking about how things are going into a downward spiral. I believe that there is a lot of guesswork and even economists are divided on this.
Personally, I am invested in companies and trusts which I think are pretty stable. I am also investing primarily for income. So, I am pretty sanguine about the situation. However, if things should change for the worse, don't be surprised if I divest. I am a pragmatist.
For AA REIT, Saizen REIT and LMIR, my three largest investments, I see continual buying by big players. This is reassuring. They probably see value and are attracted to the yields.
Your question is more of a concern to someone who might be trading the market actively. For active traders, they will have to read the signs carefully and get out before everything u-turns. They will have to do TA and look to the charts for signs of overbuying and negative divergences. It's a different game they play and one that I don't play anymore. ;)
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