Tuesday, June 19, 2007

Housing Weakness? Shocking!

Gold, Silver Rise on Speculation Housing to Pressure Dollar

June 19 (Bloomberg) -- Gold and silver in New York rose on speculation a slump in the U.S. housing market will hurt growth, weakening the dollar and boosting the appeal of precious metals as alternative investments.

Seriously? A slump in the housing market may hurt growth? I am shocked by this revelation. This is the kind of news that could absolutely shock people...from another planet.

``The biggest positive for gold would be a lowering of interest rates,'' said Frank McGhee, head metals trader at Integrated Brokerage LLC in Chicago. ``Gold is up because of the weaker housing number, which has allowed the 10-year Treasury bond to rally.''

Frank is a genius. This is THE GUY you want managing your money. Rising interest rates are ultimately good for Gold. I think we've beaten that horse to death here. Actually Frank, the biggest positive for Gold would be a falling Dollar. Oh, and look the Dollar fell again today.

If 82.50 on the USDX gives way the Dollar could be in a heap 'o dung. This of course would put a nice bid under Gold and Silver and really pressure dem Rat Bastids. A lot of shorts piled on as the Precious Metals tanked on June 8th in the face of the T-bond rout. A major short squeeze could be in the works as Ted Butler intimates in his latest "Raptors" update: The Raptors Rule .

Gold has retraced 61% of the June 8th dump. A bit of back and filling here would be expected. Should 655 serve as solid support, a run to the battlefront at 666 could be quick. Expect dem Rat Bastids to put up a good fight for that piece of turf.

Silver has retraced 50% of the June 8th dump. Silver's 50 DAY moving average [13.33] stands in the way of it's next target at 13.39. It's interesting that the same numbers we fought dem Rat Bastids for several weeks ago lie in our path once again. Keep a close eye on Silver's WEEKLY MACD. A bullish crossover will must likely lead to liftoff. Silver is always slow to get started, but once it leaves the station...she's a tough train to catch.

Oil moved further over 69 today...The round number 70 should spook the Dow.

``Gold is cooked,'' said Leonard Kaplan, president of Prospector Asset Management in Evanston, Illinois. ``The dollar is not going to get buried.''

I love these clowns Bloomberg digs up to quote. Leonard, the Dollar is already buried...they just haven't finished throwing all the dirt back in the hole. It's grave has been declared a toxic waste dump and must be approached with caution. A move thru 1.3468 in the Euro could figure big in the fortunes of Precious Metals holders. The Euro cracked key resistance today at 1.3420. Gold lately has had a bit more of a bias towards Euro technicals.

Issues with my PC today prevent me from having any charts today...I hope to have this resolved soon.

Silver Resistance: 13.33 / 13.39 / 13.50

Silver Support: 13.26 / 13.16 / 13.08
______________________________all prices SPOT

Gold Resistance: 662 / 666 / 673

Gold Support: 658 / 655 / 652

Gold/Silver Ratio: 49.71 [target is sub 49]

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