Morris Hubbartt: Commercials Are Buying Physical Gold?

May 12, 2013 By 9 Comments

m2Submitted by Morris Hubbartt:

As the chart clearly shows,  “smart money” purchases have generally occurred during major price weakness.
We are grinding through a prolonged period of such weakness now, and the commercials have been buying long positions and covering shorts. There are also rumors they are buying physical gold.
The big money in any market is usually made by buying extreme weakness. The latest COT reports may not indicate that the lows are in.  They do indicate that commercial traders believe gold offers tremendous value to buyers.

[Read more...]

Filed Under: Uncategorized Tagged With:

Fed to Replace QE With Outright Money Printing?

May 4, 2013 By 24 Comments

BernankeThe US economy would have to undergo a major readjustment if QE ceased. Quantitative easing could even be replaced with outright money printing.  One prominent hedge fund manager is already calling for it!
Regardless of day to day moves in the dollar, the US currency has to decline in the long term.
The long term dollar chart looks terrible! [Read more...]

Filed Under: Uncategorized Tagged With: , , ,

The Gold Dust Settles

April 28, 2013 By 3 Comments

gold dustSubmitted by Morris Hubbartt:

Whether gold has bottomed or not, I expect the next rally to take it up towards the red trendline, on this chart.  That would put it near $1600. Note the position of the RSI oscillator.  On this chart, it’s at a record low.  The Stokes oscillator is also very bullish.
Asian value buyers tend to be attracted to this type of situation.  They aren’t concerned about whether “the low is in” or not; they just believe gold offers good value, so they are strong buyers now.   Their approach has been pretty successful, for thousands of years! [Read more...]

Filed Under: Uncategorized Tagged With: ,

Gold Is Down But Not Out: Headed to $1350 Before Massive Rally?

April 14, 2013 By 7 Comments

downSubmitted by Morris Hubbartt:

Gold has not traded above $1900 for nearly two years, and most investors are wondering if the bull market is beginning a bigger correction.  My gold cycle analysis suggests that gold is testing the support line that extends back to the year 2009.    If you look carefully at the chart, you can see that the gold price is slightly below that support line now, which is creating technical selling by hedge funds.  I call that the “speed bump”, and it’s happened before, in early 2011.  I’ve highlighted that period on this chart.
Every gold investor wants a rally now, but this technical speed bump  could easily cause gold to decline to $1400 or $1350, before the bigger bull cycle “overpowers” the technicals. [Read more...]

Filed Under: Uncategorized Tagged With:

Cartel Gold Battlefield

April 7, 2013 By 6 Comments

Submitted by Morris Hubbartt:

Ultimately, markets are driven by fear and greed. In the current gold market, there is a lot of fear.  Also, most mainstream money managers believe a full economic recovery is underway, so there is no need to own gold.     My worst-case scenario model shows that gold could fall to $1350, but I don’t see that happening.
Only a small amount of gold is brought to market each year. Most assets can be substantially diluted in one way or another, but not gold.  Physical gold and silver are probably the highest quality assets that an investor can own.  Fear of lower prices should not deter anyone from holding gold.  Note the oversold condition of the slow Stokes indicator and RSI on this weekly chart. There is only one thing for long term investors to do, and that is to hold their positions.  Buy more, if additional weakness comes.

[Read more...]

Filed Under: Uncategorized Tagged With: ,

Ominous Stock Market Technicals

March 24, 2013 By 39 Comments

stock market collapseSubmitted by Morris Hubbartt:

At this point, quantitative easing is pumping about 85 billion electronically printed dollars a month, into bonds and other “quality assets”. Without the artificially low interest rates that QE creates, the economy would probably implode.  I view the current market as a dangerous place to allocate investment capital. I targeted 13,500 initially, for the Dow.  Now I’ve added a 2nd target, which is 12,200.

Down-day volume is beginning to overwhelm up-day volume, which is extremely bearish. The Dow could soon form a huge double top pattern, just as the infamous “Sell in May, and go away!” period of time arrives!
Overall, the stock market continues to be a huge beneficiary of QE policy. How long can this stock market rally continue? To help answer that key question in more detail, I am focused on two leading indicators. [Read more...]

Filed Under: Uncategorized Tagged With: , , , ,

Gold Market Stress Test

March 17, 2013 By 20 Comments

gold stress testSubmitted by Morris Hubbartt:

Corrections are a cleansing process.  They shakeout weak investors, and get the market poised to move higher.  Technically, key oscillators are already in the “basement”, but that does not mean you can ignore the possibility of one or more rounds of price weakness, before gold begins to rally.

Note the expanding channel on the weekly chart, which portrays what is really my worst case scenario. Most bullish analysts, including myself, think the lows for gold are occurring at this point in time.  Still, it’s important to look at the other side of the “price prediction coin”.

The channel suggests that the gold price could fall to about $1350, without doing any technical damage to the big bullish picture. [Read more...]

Filed Under: Uncategorized Tagged With: ,

Morris Hubbartt: Gold & Silver Double Bottoms

March 10, 2013 By 12 Comments

double_bottomSubmitted by Morris Hubbartt:

In the case of gold, the consolidation has gone on now for nearly a year and a half. The larger the base is, the greater the rise out of it.
There are actually two triangles in place, and gold has just staged a near-perfect pullback to the top of one of them.

Note the trade signals on the chart.  Silver has a double bottom pattern very similar to the one I showed you on the gold chart, and $29.15 is the neckline.  A move over the neckline should produce a rise to $30.43, and begin a trending move to the $40 area! [Read more...]

Filed Under: Uncategorized Tagged With: , , ,

Gold Sentiment Twilight Zone

March 2, 2013 By 4 Comments

twilight zoneSubmitted by Morris Hubbartt:

The base building process over the last 18 months has been frustrating.  There is strong support under market, coming from commercial traders.  This is the “platform” that should propel gold to higher prices.   Commercial traders are now holding positions comparable to the 2006-2007 timeframe.  Gold gained over 70% after that, and it could happen again!

When Fed officials make comments that the end of QE is coming, it’s probably a verbal sleight of hand.  A rally in the T-bond is what the gold market desperately needs!  As the price has softened, the public has fled the gold market. The old saying is, “If you can’t handle the heat, get out of the kitchen.” Well, the public clearly cannot handle the heat. Look at the extreme sentiment reading. It looks like something from the twilight zone!   I’ve never seen the sentiment for gold stocks this bearish, which means potential upside reward has never been bigger!

[Read more...]

Filed Under: Uncategorized Tagged With: , ,

Gold Bear Trap Is Sprung

February 24, 2013 By 3 Comments

m9Submitted by Morris Hubbartt:

The public’s level of ownership has declined to a level not seen since the lows of 2008. This indicates gold is probably making a major market bottom.

GDXJ has moved lower, with gigantic volume. This type of selling has driven the key RSI indicator to historical lows.   A rule of thumb is that once RSI goes below 25, buy orders can be placed.   Bearish analysts think that GDXJ has broken down from major support, but I think this is a huge bear trap.  Sentiment, climactic volume, and oscillator action suggest that junior gold stocks are about to reverse and surge higher, stunning the bears! [Read more...]

Filed Under: Uncategorized Tagged With: , ,

Gold Completing Huge Triangle Base- Next Upward Run Will be MASSIVE!

February 16, 2013 By 25 Comments

m3Submitted by Morris Hubbartt:

Fundamentally, the US dollar is at great risk. Even if politicians make headway in spending cuts in the coming months, it won’t stop the debt from growing.   According to CNS news, about 11,000 people sign up for the Supplemental Assistance Nutrition Program (food stamps) every day. As the United States heads back into recession, maintaining a social net will be priority number one.

So, leaders can attempt to make progress, but the debt is now over $16.5 trillion.  Unfunded liabilities are more than seven times that amount.  A debased currency or much higher interest rates are the government’s ultimate choice.

The fundamental issues that are negative for the dollar are also very bullish for gold.  With the long-term trend of gold being up, this enormous symmetrical triangle is likely to breakout to the upside.
A symmetrical triangle is usually formed during a consolidation period. In the case of gold, the consolidation has gone on now for nearly a year and half. The larger the base, the greater the rise out of the bull market consolidation pattern. 

[Read more...]

Filed Under: Uncategorized Tagged With: , , , , ,

US Dollar Triple Hammer Time

February 9, 2013 By 32 Comments

triple hammerSubmitted by Morris Hubbartt:

If the implosion of Lehman could only get the dollar to 89.11, is there really any hope for the bulls now?  I don’t think there is.  I’ve labeled the dollar chart the “Triple Hammer Chart”, because I see 3 powerful chart patterns, and all of them are very bearish for the dollar.

Silver is setting itself up for a nice rally.  The set-up is very similar to last fall. At the bottom of the chart, note the bullish breakout of the Aroon indicator.    Silver is my favorite asset in the precious metals group, for adding fresh risk capital.  The Bollinger bands are tightening, and that is usually followed by an explosive move. [Read more...]

Filed Under: Uncategorized Tagged With: , , ,

US Dollar Vulnerable to a Loss of Confidence Event, Massive Shift From Paper to Physical Gold Underway

February 2, 2013 By 19 Comments

morris4Submitted by Morris Hubbartt:

US debt negations have been delayed again, by squabbling political parties.  We are told that in May everything will be fixed, but the debt continues to grow, and so does pressure on the US dollar.    
The US dollar is vulnerable to a “loss of confidence” event.  That could create a stunning decline, and a powerful move higher in the price of gold. A key level that I watch on the US dollar chart is the 80.50 area, which never seems to hold for very long.

This chart has numerous head & shoulders top patterns on it, and it closed out the month of January below 80.50, which is a very ominous sign for dollar holders, and great news for gold! 
As this debt crisis continues to unfold, I expect more investors to transfer money from paper gold products to physical gold.  

[Read more...]

Filed Under: Uncategorized Tagged With: , , , ,

Massive Head & Shoulders Top Maturing in the Dollar: Breakdown Will Launch Gold Through $1800

January 27, 2013 By 23 Comments

morris4Submited by Morris Hubbartt:

The dollar’s huge head and shoulders top formation is maturing.  The target is 72. It will be activated when the dollar closes under 78, for two consecutive days.  A breakdown under 78 should be accompanied by gold breaking above $1800.

Over time, markets oscillate from undervaluation to overvaluation. The chart below demonstrates how gold stocks go from one extreme to the other, forming a channel that can be bought and sold.
In terms of undervaluation, gold stocks are now stretched to the point of challenging the 2008 panic low!  [Read more...]

Filed Under: Uncategorized Tagged With: ,

Gold Rally & T-Bond Tap Out

January 20, 2013 By 7 Comments

morris5Submitted by Morris Hubbartt:

Public participation in gold is near the lowest levels of the bull market. This is a good sign that higher prices are coming.   My upside targets are $1850, $2350, and $2750.  At $2750, I’m projecting that the public will become eager to own gold again, and the price will begin the next major consolidation.

There is a big positive divergence on the gold chart. Once gold trades above $1800 for 3 consecutive days, gold stocks should have their technical shackles removed.  At that point, I will be looking for an enormous 100% rally in most gold stocks, from the double bottom that was established in the $39 area on the GDX chart.

[Read more...]

Filed Under: Uncategorized Tagged With: