TLM, update

November 4, 2014 Hamilton

The usual then – March 2013 – and now charts.

At the time TLM was about $11, it is now closer to $6. $5.63 would be a potentially reasonable target but there are no assurances as the longer term chart does not speak very loudly. The more detailed look is actually rather promising.

On this chart the triangle is much clearer (potentially there are two). At the $6 level both the RSI and MACD are screaming “buy”. Proportionately it has dropped a same amount in the first part down from $24 to $10 as it now his from the top of the triangle at $14 to $6. In each case roughly 60%. The drop now exceeds the triangle measure AND it is occurring perpendicularly under one of the apexes. This stock should be a buy here or above $5.63

Gold, the stuff, Greenspan, the Fed. etc.etc.

November 2, 2014November 2, 2014 Hamilton

This is a chart from www.aboutinflation.com. It shows the gold price from the time convertibility still existed ( abolished in 1971!) to last year, both in inflation-adjusted and nominal terms. You can see that in 1980 gold (and silver) were great inflation hedges as the red line moved well above the blue line. Not so much recently when the two moved , more or less, in tandem proving once again that Fisher was right with his MV=PT. You can create as much money as you want, but if the velocity adjusts downward there is no effect. Which, of course, also leads to the inevitable conclusion that the gold standard must have a lot going for it, as both Greenspan and Bernanke vigorously argued as adolescent economists. It was Keynes who realised that the gold standard limited the ability of governments to fool their constituents and therefore apposed the standard. In stead “faith” entered the equation, that is faith in the neutrality of the CB. With that who needs a standard?

Just a few days ago, in case you missed it, Greenspan weighed in on these matters and, without batting an eye pronounced that QE was a failure. And, that the Fed could not extricate itself from this mess without causing a lot of pain. And “I never said the Fed. was independent”. And he also said that gold is a good place to put money these days given its value as a currency outside of the policies conducted by governments.

The end of CB omnipotence perhaps or simple a case of an emperor without any clothes , or at least a change of clothes ?????

CEF.A update

October 31, 2014 Hamilton

The usual then, then and now charts;

The ideal target seems to be about $9/$10. The A and B should ,perhaps, be just a little to the left as shown in the second chart. Wave 4 is, as always, the target par excellence. In this case all the more so as this is the starting point of the extended 5th wave on the way up. It is also where the correction retraces about 62%. The beige arrows show roughly what should be expected in the next little while. All these charts are still available in this blog.

XAU refresher

October 31, 2014October 31, 2014 Hamilton

Then – July 6th, 2014 – and now, as usual;

It is not quite there yet but nevertheless getting very close, just 7 points away! At the rate that it is dropping we could be there any day. We could go beyond 60, perhaps something like 45 or so but in the BIG PICTURE gold stocks are at a level where they might actually are becoming a buy for the first time in a long time. It stands to reason that if the stock market turns as a result of QE etc. being stopped, gold might paradoxically turn at roughly the same time. Here is the big picture again;

With the exception of 2001 and 2002 , gold stocks have not been this low for a very long time. Moreover the C of the “flat” has done the requisite 5 waves (even though one could argue that we are only completing 3). In any event a rebound to about 110 ( the top of the triangle) is very probable. That could easily mean a doubling of bad gold stocks like ABX, shown below on a longer scale;

The 5th wave does not yet appear to be complete but somewhere here between C$13 and $5 this stock is going to be a buy of a lifetime (27 years). If wave 5 equals wave 1, a normal relationship when wave 3 is extended, the perfect target would be about $10 or so. Keep an eye on the Swiss referendum as that may provide a boost to gold/ gold stocks if passed at the end of next month.

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