Axstone's Gold Price Commentary

The Gold Price May Not Be Rising in a Straight Line

noreply@blogger.com (AXSTONE) — Fri, 09 May 2008 19:30:00 +0000

The 70's are back! Is that what is being quoted in the Financial Press this week?

Well maybe the chart patterns for the gold price of the 70's are back too. I think they are.

Notice this is a logarithmic scale for the gold price and the silver price, and the trend line is not linear, that means a straight edge will not give you accurate support line for the price of gold or silver. This is important for investors and traders to consider because they need to know where to put new capital back to work on pull backs.

Jim Sinclair (bio) was the largest gold trader in the world in the 70's so I asked him what tool do we use when the straight edge no longer works. He suggested that I try a French Curve. Was I ever surprised, what a fit.

The French Curve shows a momentum change. If you need another example of how the momentum changed for gold in the past, just look at the 70's chart for the gold price. Good luck with your new technical tools you may need it with the gold and the gold shares in the future.

The affect of the gold price rising with momentum in this fashion can have a significant affect on the gold miners. Barrick Gold produced great numbers last quarter with rising margins.

Click the Image for Barrick Gold's Full Q1 2008 Presentation

I am considering shortening my time frame for dollar cost averaging into Gold and Silver.

Don't let the Gold and Silver Price Take You Out

noreply@blogger.com (AXSTONE) — Fri, 02 May 2008 02:22:00 +0000

Jesse Livermore said there were three key elements to success in a bull market, Timing, Money Management and Emotional Control.

Look closely at the silver price chart to the left, now without being emotionally involved visualize where the best places would be to buy silver over the past 7 years. Is it a the peaks where you feel most excited? NO, Is it a month after the silver price had a sharp sell off? YES

Now ask yourself is the BULL market over? if Yes, take your money and run , and DONT LOOK BACK. If However you feel we are entering into a highly inflationary time where all global currencies are FIAT and we have years left in the Bull Market to go, you are entering an ideal time to Buy Silver and Gold.

I have studied Jim Rogers, and Jim Sinclair for hours, they have done all dirty work on the fundamentals and their thesis is published for you to analyze. Conclusion BULL market in Precious metals are far from over.

What you don't want to do is put yourself in the position where you buy strength and sell weakness.

Jim Sinclair participated in a great interview with Chris Waltzek from Goldseek Radio.

Think carefully about this important message Jim makes.

Jim Sinclair 1:11 approx
http://radio.goldseek.com/

Chris W:
You discussed the dangers of leverage in the precious metals markets while promoting cash investing, I want to give you a chance to talk about why.

JIM S:
"The majority of people couldn't stand what went on in the last month in gold, You know..they would see their life passing in front of their eyes, they would be terrified of their investments ...emotions would take them out where? Directly on the BOTTOM! -- UP it goes in they GO-- Before their finished they got no money so when you speak to many people you have a responsibility and the responsibility is sort of like don't yell fire in the theater. You don't have to have a ton of gold , A little goes a long way, Its an insurance policy."....

"GOLD IS INSURANCE when you start putting leverage on it you are a speculator...go speculate in GOOGLE, leave GOLD alone!"

A very easy and fast way to Buy Gold and Silver Bullion Online.

The Gold Price Correction - Time to Focus on the Upside Now

noreply@blogger.com (AXSTONE) — Fri, 25 Apr 2008 04:19:00 +0000

The GOLD PRICE has NOT topped out, so that means what we are currently experiencing is just a correction. Is the gold price correction over? Hard to tell.

I will give you a check list to consider, that I have looked at for evidence of a bottom forming in the gold price. However this isn't that important to me now, as I am more focused on the upside target since this is only a correction. Don't be so concerned about nailing THE BOTTOM. I am more interested in the next Cherub above $1,033, our previous high.

Conclusion. I am ready to focus on the upside now.

Notes on the HUI (a Gold Stock Index)

Gold Stocks can show signs of a bottom before the actual metal so I look at a group of gold stocks like the HUI index for clues of a bottoming process. Looks like an ABC correction here, with a possibility of 360 on the downside. I used a French curve to expire this correction. I was adding to some of my Gold Growth stocks today since my old fashioned target has always been to add on or near the RSI 30 level. I am almost always early, but, I never have a problem sitting on my buys. I DO NOT USE STOPS.
Check list for bottoming process

Trendline break .. check (good sign)
RSI 30 ...check (great place to add)
ABC formation in progress... Check (final process of a correction)
French curve... in process (exhaustion move)... check

Gold Price Intervention is Normal

noreply@blogger.com (AXSTONE) — Fri, 18 Apr 2008 19:11:00 +0000

The GOLD PRICE broke a recent 1 week trend line, that made the short term traders nail the sell button all at once. The gold price moved nicely and gently down thirty dollars today. I believe this move down will not even show up on a 5 year chart.

Short term speculators that have no notion that there is an anxious intervention going on will pay the price and like Jim Sinclair says "may want to consider getting a cheaper hobby".

I stay with the plan that the intervention will not succeed in the long run and that the 4 week cycle will probably hold. The gold price low so far was put in just after a two week period during this correction.

It is not uncommon for a cycle low in this case the $880 level to be tested once again around the 4 week period but that did not happen today, the low was the $900 level today at the 4 week period . This to me is a bullish sign since it leaves the gold price with a higher low today. It is possible that consolidation could be extended with intervention and prolong the correction. I however will add to my long position in GOLD and my favorite gold shares early next week.

The "GATA Goes to Washington: Anyone Seen Our Gold?" conference in Washington, D.C., is on from Thursday, April 17, to Saturday, April 19, 2008.

GATA says in their full page ad published in The Wall Street Journal on Thursday, January 31, 2008:

"Gold's recent rise to $900 per ounce shows the price suppression scheme is faltering. When it is widely understood how central banks have been suppressing the gold, its price may rise to $3000 to $5000 or more."

Is the $1000 Gold Price Correction Over?

noreply@blogger.com (AXSTONE) — Tue, 08 Apr 2008 15:56:00 +0000

Is the $1,000 Correction over? Conventional technical analysis tells me the correction is over or close to it with the break to the upside of the green down trend line. I also like to look carefully at the peak to bottom cycle period in the gold price which is nearly complete. Historically it has proven to be a 3-4 week cycle form peak to bottom. So now, enter the era of consolidation and the formation of a continuation Pattern, in other words UP AND DOWN sideways action. A retest of $880 or even a final low of $850 is possible on the downside but the more interesting move in my opinion is the $1,250 point on the upside.

In the 4 week period which is coming upon us I will be dollar cost averaging in physical Gold bullion and in an allocation form at Goldmoney.

$1000 Gold Price Hurdle

noreply@blogger.com (AXSTONE) — Thu, 27 Mar 2008 18:42:00 +0000

The Gold Price has successfully touched the $1,000 gold price mark, where profit taking took place. Even though this market is still undervalued the round number $ 1,000 was a place to take a pause. The next step is consolidation, I expect tight consolidation to occur here. A typical up down consolidation. Three attempts at the $ 1,000 gold price and some time should put it behind us.

GOLD PRICE HITS $ 1,000 .. more to come ...

noreply@blogger.com (AXSTONE) — Thu, 13 Mar 2008 23:58:00 +0000

Gold Price Stretching its Legs For the $1,000 Run

noreply@blogger.com (AXSTONE) — Wed, 12 Mar 2008 13:54:00 +0000

Gold turned over around the $990 spot gold price, and has once again entered into a consolidation pattern all to familiar to gold. This is a nice pause to allow the gold price to nicely push through the $1,000 dollar mark.

This pause is very healthy for the gold price. What you don't want to see is a peak top where the gold price shoots up and and comes sharply downward like in May 2006. This tells me we still have a wave 5 run in gold to go, which could take the gold price significantly higher.

Remember to dollar cost average, technicals are a short term game, buy gold and let the bull market save you.

This quote is from Jesse Livermore, in the book Reminiscence of a Stock Operator:

"For instance, I had been bullish from the very start of a bull market, and I had backed my opinion by buying stocks. An advance followed, as I had clearly foreseen. So far, all very well. But what else did I do? Why, I listened to the elder statesmen and curbed my youthful impetuousness. I made up my mind to be wise carefully, conservatively. Everybody knew that the way to do that was to take profits and buy back your stocks on reactions. And that is precisely what I did, or rather what I tried to do; for I often took profits and waited for a reaction that never came. And I saw my stock go kitting up ten points more and I sitting there with my four-point profit safe in my conservative pocket. They say you never go broke taking profits. No, you don�t. But neither do you grow rich taking a four-point profit in a bull market.

I think it was a long step forward in my trading education when I realized at last that when old Mr. Partridge kept on telling other customers, �Well, you know this is a bull market!� he really meant to tell them that the big money was not in the individual fluctuations but in the main movements - that is, not in reading the tape but in sizing up the entire market and its trend.

The market does not beat them. They beat themselves, because though they have brains they cannot sit tight. Old Turkey was dead right in doing and saying what he did. He had not only the courage of his convictions but also the intelligence and patience to sit tight.

Disregarding the big swing and trying to jump in and out was fatal to me. Nobody can catch all the fluctuations. In a bull market the game is to buy and hold until you believe the bull market is near its end."

Read more here

Dollar cost average on weakness is an excellent way to participate in the Gold
Bull Market..

$1,000 Gold Price is No Reason to Take Profits

noreply@blogger.com (AXSTONE) — Wed, 05 Mar 2008 13:28:00 +0000

There is talk that a $1,000 gold price should be an area of resistance and time of profit taking.

You have to ask yourself when you read that (which is everywhere today) what kind of analysis is this?

What does a round number in US dollars have to do with a sound reason for taking profits in gold? Absolutely zero!

The US dollar is the common stock of the US whose balance sheet has gone wild. Gold sailed through the $500 level a few years ago rightly so, any resistance at $1,000 at this stage of the game is total nonsense and manipulation on several levels.

I have looked at over a dozen metrics and ratios that value Gold well north of $1,000 dollars today with a minimum of a $1,350 gold price today but we get stuck on the analysis of round numbers? This world is insane and is going where it deserves to go in my opinion.

I use technical analysis with GATA’s fundamentals so I feel very comfortable ignoring over bought areas in gold 90% of the time, I always have and always will until the evidence is overwhelming the Cartel has thrown in the towel.

Gold Price Making New Highs Pushing Off Trend Line

noreply@blogger.com (AXSTONE) — Thu, 28 Feb 2008 23:29:00 +0000

The gold price failed to break the trend line and actually pushed off it. I suspected that if the Cartel could not break this trend line gold was going to soar.

The silver price never did correct and has had stellar gains catching up to the yellow metal and reducing the Gold Silver Ratio to 48. This is a super bullish sign, you never want to be out of a market this strong. The value here has to be the Gold and Silver Junior miners. The story in the media like CNBC is to short the gold stocksand go long gold. My contrarian view is if its in the media do the opposite. I think that trade was on and I think the shorts on the gold producers is over !
.
I am looking at a handful of junior gold producers that have recently broken their down trends and I cant think of a better value in this industry than some of these junior gold stocks.
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Below is just one example of a junior gold stock that I like that has recently broken its downtrend.

When Will the Gold Price Correction End? Can Silver Give us a Clue?

noreply@blogger.com (goldprice) — Wed, 13 Feb 2008 05:49:00 +0000

In my previous post on February 4th. I had a chart on gold that showed the possibility of a head n shoulder pattern formation in the making. It is a pattern that has always ended in a failed pattern with the result of the GOLD PRICE surging upwards in a shake out pattern [that's GOLD].

While the pattern is in development the bears come out of the woodwork and point to a drastic failure at the neckline and paint the image for a massive decline in the Gold Price. Then in their next newsletter they show how the gold price of course roared out of that pattern in a bullish fashion after the pattern failed, THATS a BULL MARKET. I expect nothing different this time.

What this means is , I expect this Head n Shoulder to fail at some point, with some scary moments for gold longs that watch every tick in the gold price.

Before we go further I want to recap an important message from Jim Sinclair (click for Jim's resume) that MARGIN IS A NO NO with anything GOLD with less than 25 years experience in trading.

Now with that behind us, I am looking for a tip to when the ultimate failure happens with respect to the Head n Shoulder pattern , for this I am looking to the silver price this time. I am looking for a reversal pattern in Silver in the coming weeks.

I know Silver is not considered money, I know Silver is an industrial metal, I know there is global slowdown talk, I know the GOLD SILVER ratio is very high (53 today) in historical terms.

With all that Said, I expect the silver price to consolidate here, and SILVER doesn't do it gently. Looking at the lack of follow through with the Silver shares, I expect that an intermediate top in silver today is in place, therefore were do we correct to.

The silver price typically retraces hard because of the small market cap it has, so unless you are from Mars you know the volatility with this one is the wildest. I could be wrong and Silver could lunge higher here to $19 or higher, but I don't count on it at this stage. ( I just don't) with the Gold Price down hard today and Platinum with a reversal in too, not to mention Palladium :(

So now that I have painted the picture for a hard correction for the silver price, where does it end and what to look for. I am going to look for two signals on the charts in the next three weeks, on a weekly closing chart for silver, I am going look for a long wick and a clear reversal pattern with silver. Second I am going to look for an RSI around the 40 mark which is a typical momentum indicator to touch at the end of a correction in a bull market.

The Gold Price technicals after strong $ 45 sell off

noreply@blogger.com (AXSTONE) — Mon, 04 Feb 2008 22:53:00 +0000

Short term view, gold dropped off friday after hitting a new all time high. Two simple technical points to consider are the Trend line and pattern development; if we do not make new highs within the week we could be in the process of building a short term head n shoulder pattern where spin could lead to pressure on both the neckline in orange and the trend line in red. If these are violated I take the view it would be a great entry point to dollar cost average for a run to $ 1,050.

Gold Price has been the Star.. Silver is about to Shine

noreply@blogger.com (AXSTONE) — Thu, 31 Jan 2008 15:10:00 +0000

Gold has been the star, but silver is about to shine. Silver has room to run here in its effort to reach its historical norm. Whether we hit the low GOLD SILVER ratio of 15:1 is yet to be seen but I believe this ratio will fall. As Gold moves towards 1,000 simple math of a gold silver ratio could easily move to 40:1 which would give you a Silver Price of $ 25.00.. So its not a stretch to see Silver move 8 dollars higher here going forward.

You can now add silver via Gold Money, I dollar cost average monthly by adding to my account.

Gold Price target hasnt changed... The platform has

noreply@blogger.com (AXSTONE) — Mon, 28 Jan 2008 19:33:00 +0000

I need to quote Jim Sinclair here today. In doing so we are riding on the shoulders of a Giant in the gold market:

Gold is being influenced now by the magnet at $1,050 pulling from the front. Sellers exist at $950 to $960. The breaching of the $887.50 level multiple times as the gold price gyrated back and forth before reaching its present historic high is quite important.

Jim Sinclair
www.jsmineset.com

Gold Building a platform to run to $ 1,050.00

noreply@blogger.com (AXSTONE) — Thu, 24 Jan 2008 22:42:00 +0000

Gold will build a platform here around the 887 level to launch towards 1,000 dollars.. Any correction in gold from 900 + levels just works off any over bought technicals making the run for 1,000 smooth sailing.

Jim Sinclair's answer to the Question on the chart is

YES!

I would use corrections to dollar cost average here

Gold Price trying to continue out of Flag Pattern

noreply@blogger.com (AXSTONE) — Wed, 23 Jan 2008 21:50:00 +0000

Gold is trying tonight to continue its march higher. This recent bounce is once again creating a very bullish Flag Pattern.

Gold Price Surging on Fed cut.. takes out downtrend

noreply@blogger.com (AXSTONE) — Tue, 22 Jan 2008 15:35:00 +0000

Gold takes out downtrend on Fed Rate cut. Gold could consolidate creating yet another continuation pattern rising wedge. This would build a platform for gold to run to 1,000.00.

Gold Price reaction will be quick

noreply@blogger.com (AXSTONE) — Tue, 15 Jan 2008 23:52:00 +0000

The Gold cartel may target the trend line, but I am looking for a quick bounce to 960.

I would be using any correction as an opportunity to buy physical gold.

Gold Price Broke recent down trend.. 940 is on the Menu

noreply@blogger.com (AXSTONE) — Thu, 10 Jan 2008 17:04:00 +0000

Notice the powerful break of the recent downtrend. 940 Maybe in the cards sooner than later.

Gold Price set for quick shake out before 1,000 target

noreply@blogger.com (AXSTONE) — Wed, 09 Jan 2008 20:08:00 +0000

We have had a variety of corrections lately, the ABC and then consolidation. This time I see a fast shake out before we run to 940. Hang on tight and use the opportunity to dollar cost average.

UPDATE:.. Jim Sinclair's comment on my correction to 850... and I quote.. "worse case scenario" .. So I stand corrected .. sorry for those hoping to get in down there. :)

Gold Price could push higher here

noreply@blogger.com (AXSTONE) — Tue, 08 Jan 2008 03:20:00 +0000

Gold looks like it is ready to push higher. This consolidation pattern should have been the necessary platform to push gold to the 880 area.

Great way to dollar cost average

Medium Term Upside Gold Price Target 950

noreply@blogger.com (AXSTONE) — Thu, 03 Jan 2008 21:05:00 +0000

My Medium term price target for Gold in the First half of 2008 is 950 USD.

Gold Price Breaks Out of Pennant

noreply@blogger.com (AXSTONE) — Thu, 27 Dec 2007 19:25:00 +0000

Did you have the conviction to buy gold into the 4 week low? If you buy gold after the move you are chasing strength, but the Gold Bull Market will save you. It may test your patience as the breakout of pennants can retest the nose before marching higher. The next magnet as Jim Sinclair has mentioned is the 887.50 area.

Gold Price at Bottom of a Pennant Formation

noreply@blogger.com (AXSTONE) — Tue, 18 Dec 2007 02:27:00 +0000

The gold price is in a very bullish pattern, if the Pennant fails it is more likely a bear trap and would complete a flag pattern. The Cartel often pushes the gold price to test and even briefly break trend lines .

These areas have always been a great place to add new capital. Dollar cost averaging has been a great way to capitalize in the gold market over the past 5 years.

The gold shares have been pounded into the oversold area showing 30 on the RSI today on many indexes and are begging for a bounce.

Ron Paul Invests in Gold Stocks

noreply@blogger.com (goldprice) — Mon, 17 Dec 2007 00:27:00 +0000

Presidential hopeful Ron Paul wants to bring America back to the gold standard and has personally invested $1-$3 Million in Silver and Gold Stocks.

Ron Paul's Gold Stocks (pdf file)

Ron Paul sings Gold Finger