In late June, I had high hopes for a new break-out in gold. It is now flat for the year again and sits at critical support levels (see chart below) as new hopes surge with the dollar bulls.

Click to enlarge

1. Bullish trends in the gold options markets
2. The historical “gold-oil ratio” averages
3. Potential market-moving events to drive demand
   

This is a quick update following another day of drubbing for the precious metals. The uptrend I drew in my previous post has been broken although streetTRACKS Gold Shares (GLD) has remained above its 50 dma of $89.84. An optimist might argue that GLD is sitting at another more important trend line. Nonetheless, it's prudent to listen to the price action.If GLD closes below the 50 dma, it will be a good short given how gold trades.

One may argue that the negative COT positions presaged this decline. This is another indicator to pay attention to in the future!

A couple of recent events led me to write this post. First,  I received a request on one of my earlier posts on Gold, to give my take on Silver. Why not? After all, Gold and Silver have been the choicest possessions of men and women over centuries. Be it any civilization, any era, the fascination for these pretty, shiny things has captivated and motivated one and all.

Next, some friends and I had a deep discussion on the future of precious metals, given our current economic condition.  So here’s what I’ve got to say about Gold and Silver:

"Gold is the only financial asset that isn’t someone else’s liability and it’s the only asset that’s reliably held its value over time," notes Yiannis Mostrous.

In his Vital Resource Investor, he adds, "Indeed, gold has held its value for millenia. An ounce of gold still buys a quality men’s suit, just as it did in the days of ancient Greece." Here, he reviews a trio of ideas.

"To date, Americans have never had to experience the society-wrenching events that have affected much of the world for centuries. But most of the globe’s population hasn’t forgotten the value of gold in times of extreme

"After reaching a 27-year high in March, gold corrected 17%; after a two-month base-building period, gold has broken out and resumed its uptrend," notes Nick Vardy.

In his Global Bull Market Alert, the international investing expert states, ""It's now a golden time to consider the SPDR Gold Shares ETF (NYSE: GLD) as a solid, short-term trade even while global stock markets struggle."

"Gold has historically performed strongest during times of global uncertainty and high-investor pessimism. As a rule of thumb, the worse the headlines, the higher the price of gold.

"In addition, inflation is back

By Mike Caggeso

Spot price of gold eclipsed $935 in trading Monday, its first time above the mark since May 22, as another fresh round of record oil prices exacerbated existing market-wide turmoil.

Filed under: Newsletters, Technical Analysis, Commodities, Oil, Stocks to Buy

Using a proprietary "volume reversal" trading strategy, Mark Leibovit has been consistently ranked among the top newsletter timers. In his VRTrader, he looks at the outlook for stocks, oil, gold & silver -- and offers his choice for exchange-traded funds for traders to play these markets.

Leibovit explains, "The stock market's decline, besides being huge, is relentless. Every rally was met with selling and fresh lows were soon hit. The Dow crashed through the March and January lows and is now trading at its lowest

"This correction in precious metals is a normal occurrence in an ongoing bull market," says resource sector expert Curtis Hesler, who had correctly forecast the current setback.

In his Professional Timing Service, the advisor outlines his expectations for gold and silver prices and offers some favorite investment ideas in the sector.

"We are beginning to hear all sorts of bearish commodity talk from the media, as you always do when prices correct. But you must firmly understand that this commodity bull is not a 'bubble'; it will become a 'bubble' eventually, but not for some time yet.

"We wil

Filed under: International markets, Newsletters, Barrick Gold (ABX), Yamana Gold (AUY), Canada, Commodities, Stocks to Buy

With gold trading down sharply from its highs, Keith-Fitzerald offers a special report on gold stocks in Money Morning, highlighting three companies that he consider to be the "very best of the best."

"Gold remains a key profit opportunity -- especially if inflation, or even stagflation, is taking hold. It should also help that economic uncertainty is escalating. However, since the economic outlook has grown more uncertain, we've decided to our recommended list down to ju

Take your pick. Either one is going to make you money. Oil was up over $10 on Thursday and Friday, setting records for both its high price and its US dollar move. In response, the US stock market tanked on Friday and the S&P500 is now down 6.5% for the year.

Reports say US citizens' net worth fell in the first quarter for the second quarter in a row. Talk from Israel about bombing Iran didn't help. If this happens and Iran responds by bottling up the Straits of Hormuz, well then $200/barrel oil will look like a nice bargain and a very severe recession, if not depression, will begin. Of cour