Beiträge von Schwabenpfeil

CARTEL CAPITULATION WATCH

The DOW just keeps on rising – to 10550, up 11. The DOG jumped another 9 to 2094.

02:39 Euro zone finance ministers expected to agree to continue to talk down Euro reports the WSJ
The agreement is expected at today's regular monthly meeting. In recent days officials have denounced the sharp rise in the Euro versus the dollar and blame the large U.S. budget deficits for the move.
* * * * *

Lois Ringel notes:

Quite a bit different from what I hear on CNBC Europe this morning..Consensis from pundits there felt that nothing would be done..also mentioned that Trichet's comment of "brutal" in regards to the strength of the Euro was not translated correctly, and that in French that translates into "sudden"...amazing the difference in the European channel versus ours... ***

Chuck checked in earlier:

NO sounded great. Either during this lift in the dollar or right at the end of move, we should start to see the real move in the shares and the metals. It needs to come out of great skepticism and there are too many people who have learned to connect the dots with a falling dollar. A rising dollar will perplex them. This stock rally is about toast. A strong dollar will trigger selling. Hoye is looking for 10,600 and then the decline. Could have a little pain this week. Chuck

[Blockierte Grafik: http://www.lemetropolecafe.com/img2004/privateer.gif]

[Blockierte Grafik: http://www.lemetropolecafe.com/img2004/bianco.gif]

The John Brimelow Report

JB: Bears flunked today? Interesting Bianco

Monday, November 15, 2004

Indian financial markets were all closed today. So were all markets in the Muslim world, including the Gulf, Turkey, and Singapore. This was therefore the easiest day for the Bears to counter-attack significantly. They have not done much.

Although trading in the rupee is thin on such a day, Reuters did show it below $1 = R45 a couple of times, a new high. Since the Indian currency tends to move inversely with the oil price, the oil slide since India closed early on Thursday NY time is likely to see a firm rupee tomorrow, bolstering gold imports. Most commentators still assume that weak oil means weak gold: this is an obsolete thought now that India is so important to gold.

TOCOM gold was very quiet today, with the strong yen playing its usual discouraging role. Volume dropped 31% to only the equivalent of 12,223 Comex lots, but open interest did edge up again, by the equivalent of 720 Comex, to 105,595 NY equivalent. There was some talk of Japanese speculators coming into precious metals from Oil, but platinum seems to be the favoured vehicle. (NY on Friday traded a robust 64,414 lots: open interest rose another 4,326 lots – 13.45 tonnes – to 347,340, yet another record.)

Currently the Bears are alleging front running of the ETF as the reason for gold’s strength, with the brightest spokesman pointing out that the Hirohito Coin 600 tonne buy order in mid 1986 caused a period of strength which puzzled many. He fails to point out that the peak in Fall that year, just over $440, was easily surpassed in 1987 which saw gold much higher most of the year, ultimately clearing $500.

Bianco Research put out an interesting note on Friday, puzzling about the contrast in the big reduction in Mine hedging recently reported, and the behavior of the CFTC data (the study of which they to a fair degree pioneered).

"The de-hedging trend is not supported by the CoT chart..The Commercials/Hedgers…have been moving shorter and shorter for many months and are now near their most extreme position in 12 years. This suggests that hedgers have been selling more futures contracts in recent months - not reducing their hedging. We cannot explain the difference between these two measures. If anyone has any thoughts/explanations, please pass them along."

Of course, mines are not the only commercials in gold – there are fabricators – but that this discrepancy should puzzle this highly experienced Commodity outfit is notable. (See attachment. Scroll down for charts.)

While waiting for the physical market to squeeze the Bears again, it is worth contemplating The Privateer’s massive $US 5x3 point and figure chart, which has decisively rejected a triple top (second attachment).

JB

None of us have seen anything like Andrew. The next thing I know the very clever Joe Martin, who runs the superb Cambridge House gold conferences in Canada, was talking to Andrew about a speaking appearance.

My colleague Chris was his usual entertaining self.

I rapped it up with some mention of the GATA prints and what the GATA painting represents. We sold 10 at the conference and there are only 46 left out of the 300 limited edition printing. When we are down to 30 the price is going up to $1,000, as has been planned all along. They are $750 now plus $25 for shipping. For new Café members, the work of GATA artist Alain Despert is selling very well at $5,000/$8,000 a pop in Bora Bora See http://www.despert.com. When the gold market goes nuts and the GATA story breaks, these prints will be a part of US history. If any of you would like one, contact Chris Powell at GATAComm@aol.com. Just remember, when they are sold out you will only be able to own a print if one of the 300 wants to sell.

November 15 – Gold $436.50 down 90 cents – Silver $7.53 down 6 cents

Harry Potter Wows ‘Em

"There seems to be a correlation between the intensity of the official attacks on gold and the severity of monetary crises." Hans F. Sennholz

Just walked in the door from New Orleans. Was a wonderful GATA success in the Big Easy. More below.

Out of the loop today, so my report will be from what I have been told and from what I see. It seems rather extraordinary.

Last night the GATA gang was hanging out at the Sheraton Bar before heading out to dinner and gold was up $1.40 with the DEC contract ready to take out $440 and the reported stops above that level. We should have taken a picture then of the price and called it a day (for the next 24 hours). That was about the best gold was going to do with the bums going into action. DEC eventually did take out $440, however the resulting commotion was a wasn’t. Down she went instead of up, thanks to Goldman "Hannibal Lecter" Sachs and friends.

However, what is most striking is how quiet the day was with gold at 16-year highs. Most markets become very volatile when they break into such significant new high ground like gold just did. Instead, gold went comatose. Yes, the dollar put in a rally to quench the gold action. However, we know this is how The Gold Cartel has used the dollar to keep gold from creating excitement around the world in other currencies. At some point in the very near future, gold is going to break from the dollar due to the very firm physical market.

Here is a shocker. The DEC gold and silver open interest went up on Friday with a little more than a week left before first notice day. The DEC gold contract rose 1868 to 247,907, with the total open interest rising 4195 contracts to 347,209. With so few days left before first notice day, one would expect the DEC positions to be contracting by now with new buyers going into FEB. Ain’t happening like it normally does.

The same with DEC silver. It rose 269 contracts to 86,155. The total silver open interest went into new high ground at 123,078, up 566 contracts.

Not sure what it means yet. However, it is potentially explosive should a number of the Dec longs ask for delivery. I am not hearing any talk about this, which what may be the most bullish factor of all. Time will tell here. Any kind of delivery squeeze is a long shot, yet could happen if someone decides to take what’s left of the visible silver supply. Have to stay all over it.

One thing which really struck me at the New Orleans conference was the amount of SHORT-TERM bearishness. There were way more bears there than bulls. Yes, most everyone was bullish in the long term, but most felt gold would be dumped first. Then, there was never admit your wrong Robert Prechter who is still big time bearish. I consider him now to be an embarrassment. Years ago, he said if gold took out $376, he would turn very bullish, looking for gold to take out $1,000 per ounce.

Goldman Sachs was talking up the bear case today on the Comex and was CONSPICUOUSLY seen putting on PUTS. As reported in this column lately, they have been a noticeable seller of late on behalf of The Gold Cartel.

The GATA crew is a bunch of independent thinkers. Mike Bolser, Catherine Austin Fitts and Frank Veneroso are short-term bearish. James Turk and I are bullish. At least one of our group will be correct.

The silver warehouse stocks dropped to 102,182,715 on Friday, a new low for the move.

The dollar went up by .34 to 84.05 with the euro falling .42 to 129.43. Oil tanked to $46.87 per barrel – inflation bearish, but Indian gold demand bullish.

HOW ABOUT THAT CRB!!!! It erupted to 287.38, up 4.09. Coffee went bananas. Cocoa lifted nicely and the grains have caught a bid. It is only 2 points from making a new high and this is with oil having dropped close to $10 per barrel. Deflationists won’t like this development.

The New Orleans conference was a big winner for GATA. Kathleen Steer, Ed’s gorgeous daughter (The GATA Girl), manned our booth most ably and outshined all of the Dines’ Birds. Look for a repeat in Vancouver on January 22 if we are lucky enough to corral her again.

Chris Powell was awesome in his organization of GATA’s activities. He received many kudos from different quarters.

The GATA luncheon to wrap up the conference was a huge success. When we walked into the setting, it looked like a G-7 meeting the way the head table was elevated in this huge ballroom with sky high ceilings and a view overlooking the Ponchetrain River.

We had 90 people show up with little promotion. Great crowd. Two billionaires along with the very special Richard Olsen, a New Jersey mechanic, who flew 4 of his sons and brothers in laws in from all over the country to attend the luncheon because Richard believes what GATA is doing is that important to our country.

You don’t find more top notch people than these attendees either:

*Sprott Asset Manager CEO John Embry
*Former Harmony Gold chairman Adam Fleming – now chairman of Wits Gold in South Africa
*Don Doyle, CEO of Blanchard Coin, who is doing an incredible job of suing JP Morgan Chase and Barrick Gold on charges of gold price manipulations.

Dan Norcini was a hoot as was Wistar Holt and his sidekick Charlie of Holt & Shapard Capital Management.

Candente, Samex, and Klondike Star were ably represented.

Nanik Daryanani flew in from the Canary Islands.

On the dias, my mentor Frank Veneroso shook up the attendees with a GATA related spook story – making me look toned down when it comes to the conspiracy stuff. Catherine Austin Fitts was her dazzling self. James Turk made some news about what the ETF's coming on stream may really be about. Ed Steer spoke eloquently of his grandfather fighting for freedom and why he signed up with GATA. Unfortunately, Mike Bolser had to leave early to catch a plan as did Reg Howe and Bob Landis. Then, there was GATA’s "Harry Potter," Andrew Hepburn, who co-wrote Sprott Asset Management’s publication, "Not Free, Not Fair: The Long-Term Manipulation of the Gold Price," along with John Embry. Harry is about 5’ 4" and looks much younger than he is, a mature 20.

From the elevated head table, I could see the attendees all begin to lean forward to listen this college junior. Cool as a cucumber, Andrew delivered a brief presentation with the savoir faire of an elder statesman and delivered the line of the entire conference as far as I am concerned. Went something like this:

The intellectual capital of the gold world is in this room – referring to Frank Veneroso, James Turk, John Embry, Adam Fleming (Reg Howe and Bob Landis), etc. Most of the other gold output out there is all drivel.

Zitat

Original von midas

Vielen Dank für Eure Mühen, natürlich ist es ruhiger im Board geworden, aber es gibt sicher viele wie mich, die es kaum schaffen alles zu lesen, geschweige denn selbst noch Beiträge zu liefern.

Macht bitte trotzdem weiter !!!

Hallo midas,

klar machen wir weiter. Schliesslich ist uns das Forum hier "ans Herz gewachsen" ...

Gruß
Schwabenpfeil

Zitat

Original von hpopth
# Hallo Schwabenpfeil,

Warum sollte ich das nicht machen, habe mir schon Gedanken wegen Thai gemacht, aber er ist ja auch bei silberinfo nicht mehr aktiv, was solls, geht auch ohne ihn.

Hallo hpoth,

na ja, ich befürchtete schon, Du hättest auch Deinen "Rückzug" erklärt ... Ist schon sehr schade mit Thai, hoffentlich ist privat alles in Ordnung bei Ihm ...

Gruß
Schwabenpfeil

@ Ulfur: Mich würde wirklich interessieren, wie Du über die beiden aufgezeigten Möglichkeiten denkst ... Danke im voraus !

Gruß
Schwabenpfeil

Like pretty much everything else having to do with the markets, dollar sentiment is fractal in nature. In addition to episodes of popular bullishness and bearishness at the major interim tops and bottoms on a strategic scale, there are also miniature sentiment waves that cascade through the dollar over the short term. I suspect the current notoriety of this dollar bear is a product of a short-term sentiment wave rather than a long-term one.

In this tactical chart we can see the end of the fourth major dollar downleg and the beginning of the fifth. Just as general dollar sentiment was rotten and everyone was shorting in January (except us contrarians), dollar sentiment was positively glowing at the currency’s latest major interim top in May. I was watching this top very closely and went long gold stocks again after their early 2004 correction so I paid careful attention to what was said about the dollar.

After that May top, big Wall Street brokerages were predicting additional serious moves higher in the US dollar. I remember reading a couple reports calling for a target level of 100 in the US Dollar Index before 2004 ended. This dollar-bullish noise grew so intense and loud that even some analysts who usually traffic in contrarian circles were sucked in. To their credit the “contrarians” weren’t as bullish as Wall Street, but I saved contrarian newsletter reports from this summer calling for 95 to 96 in the dollar index by autumn.

Dollar bullishness also exploded again in late August as the dollar threatened to break out from both its short-term and long-term resistance lines. If you compare this tactical graph to the earlier strategic one, you will note that the dollar hugged both key resistance levels for a couple months. This was a particularly rough time for gold investors, as dollar strength usually translates into gold weakness. If I had an ounce of gold for every e-mail I received on this between late July and early October, I could start my own central bank.

The point of all these observations is to illustrate that the noisy majority is always wrong near market turning points. Dollar bears came out of the woodwork last January as bearish media coverage exploded, but they were wrong. Only contrarians predicted a major bear-market rally in the dollar. Similarly, in May and later last summer, dollar bulls multiplied along with bullish media coverage. Only contrarians predicted that the fifth major dollar downleg already underway would accelerate into autumn.

By the time any market event becomes mature enough or prominent enough to dominate the major news outlets, odds are that the vast majority of that move is past. If you buy when others are brave and sell when others are afraid like a mainstreamer, perverting Mr. Buffett’s brilliant advice, sooner or later you are going to lose all your trading capital in the markets. If you want to consistently win, you have to force yourself to adapt a contrary focus to mainstream investing popularity.

And this thought brings us to today. The intermediate-term and long-term outlook on the dollar remains bearish, but short term a bounce is certainly possible. By a bounce I don’t mean a massive multi-month bear market rally like the first half of 2004, but a sharp move higher over a couple of weeks or so. Two previous bounces are labeled above, in June and July, which each carried the dollar higher for a short spell.

Technical bounces are totally normal during major downlegs, they help bleed off temporarily excessive fear and rebalance sentiment. Today’s soaring media coverage and the resulting growing notoriety of the dollar’s weakness is both a result of growing fear and a catalyst for even more fear. Unless the dollar bounces briefly, fear could get out of hand. Bounces solve this sentiment problem.

These technical bounces generally occur when the dollar hits its tactical support line, just as it did in June and July before the previous two bounces. As you can see in this chart, the US Dollar Index just slammed into this same support line again for a third time in early November, and a minor bounce may already be in progress.

If this fairly-high-probability bounce indeed materializes in the coming weeks, it could carry the dollar back up as high as 86+, up to the same upper resistance line at which the currency lingered last summer. But, even if the bounce does run all the way back up through the dollar’s tactical downtrend channel, odds are it will be short-lived. With strongly bearish intermediate and long-term outlooks, any dollar strength on a minor technical bounce will probably be fleeting at best.

The bottom line is the dollar bear’s notoriety is growing, which naturally causes concern among contrarians. A contrarian wants to buy when others are afraid and sell when others are brave, so contrarians short the dollar today are wary that the mainstream is growing too fearful of the falling dollar. But, thankfully for contrarians, the technicals and fundamentals only seem to support a short-term dollar bounce at best, not a major bear-market rally and certainly not the end of the dollar’s secular bear.

If you are interested in trading this potential dollar bounce, please consider subscribing to our acclaimed Zeal Intelligence monthly newsletter. In the current November issue I discuss how we are planning on playing a dollar bounce in terms of the primary beneficiaries of dollar weakness, gold stocks and gold-stock options.

While such a minor dollar bounce would probably hurt these speculations short-term, it would create some excellent buying opportunities if the dollar does head up to its own resistance for a short time. We are currently screening various gold-stock options as well as junior gold miners for potential purchase if the dollar does indeed challenge its resistance again before its downleg resumes in earnest. It would create the first good buying opportunity for leveraged gold plays since last summer.

Our subscribers also have exclusive access to a new subscriber-only charts section on our website, which among dozens of other charts includes a high-resolution Relative Dollar chart updated at least weekly so you can monitor the ongoing progress of this major dollar downleg. This is especially important for gold investors since gold’s next major correction will probably commence the moment this fifth major dollar downleg ends.

The dollar bear’s notoriety is certainly growing, but so far the popular fear doesn’t look great enough to do anything besides spawn a minor dollar bounce at best. Contrarian investors and speculators directly or indirectly short the dollar probably have nothing to fear in the intermediate and long-term time horizons.

Adam Hamilton, CPA

November 12, 2004

So how can you profit from this information? We publish an acclaimed monthly newsletter, Zeal Intelligence, that details exactly what we are doing in terms of actual stock and options trading based on all the lessons we have learned in our market research. Please consider joining us each month for tactical trading details and more in our premium Zeal Intelligence service at … http://www.zealllc.com/subscribe.htm

Questions for Adam? I would be more than happy to address them through my private consulting business. Please visit http://www.zealllc.com/financial.htm for more information.

Thoughts, comments, or flames? Fire away at zelotes@zealllc.com. Due to my staggering and perpetually increasing e-mail load, I regret that I am not able to respond to comments personally. I will read all messages though and really appreciate your feedback!

Copyright 2000 - 2004 Zeal Research (http://www.ZealLLC.com)

As this secular trend indicates, the dollar bear is certainly nothing new. While mainstream investors start paying attention thanks to the exploding news coverage of this long-underway event, contrarians and gold investors have already been earning big profits for years by betting with this primary trend. Indeed this dollar bear is one of the key components undergirding the powerful Stage One gold bull.

Interestingly, as contrarian theory predicts, the notoriety of the dollar bear is heavily dependent on its price. The dollar bear weighs heavily on investors’ minds when the dollar has been weak for a month or two and it trades near its lower support line rendered above. But once the dollar rallies back up towards resistance and has a strong month or two, the notoriety of the dollar bear evaporates like a desert mirage.

It is a natural human tendency to extrapolate immediate market conditions out into infinity. When prices rise people feel good and greedily expect farther rises. But when prices are falling people feel bad and grow fearful of additional drops. It takes a lot of time and effort to overcome this psychological tyranny of the present to develop a resolutely contrarian focus. Considering markets within their long-term contexts is an important first step.

The secular dollar bear shown above has had five distinct downlegs, including our current specimen. Each major downleg lasted several months or so and dragged the US Dollar Index down to fresh new bear-to-date lows. With the dollar breaking 85 in recent weeks we already have a marginal new low on this current in-progress dollar downleg. Peak to trough, the US Dollar Index has slumped 31% bear to date.

Interestingly though, even in light of the growing media frenzy surrounding the dollar’s latest slide, the currency doesn’t look anywhere close to carving a major interim bottom yet, let alone ending its secular bear. There are a couple key technical reasons that a major interim bottom isn’t likely here and many fundamental reasons why this secular dollar bear is probably not yet approaching its ultimate end.

As this chart reveals, major interim bottoms in the dollar, the kind that precede powerful multi-month bear-market rallies, generally happen only when the dollar is near its lower support line. The last two major downlegs, labeled 3 and 4 above, both failed to bounce higher until the dollar solidly slammed into its support. The downlegs before that, 1 and 2, didn’t travel quite as low but they still were in the lower half of the downtrend channel approaching support when they finally gave up their ghosts.

In contrast the dollar’s fifth major downleg today is nowhere near support. At best it is still in the upper third of the dollar’s downtrend channel, and it probably has to grind way down into the lower quarter or so of this downtrend in order to find strong enough support to attempt a major bear-market rally. As long as the US Dollar Index continues to trade high up in its downtrend near resistance like today, odds are we aren’t going to see a major interim bottom.

The Relative Dollar concurs with this simple trending technical analysis. Note above how the dollar’s black 200dma line runs parallel with the dollar’s downtrend channel. In any secular bear market, a price gradually marches lower by falling below its 200dma (a downleg) before periodically retreating back up to its 200dma (a bear-market rally). The red rDollar line precisely quantifies this key ongoing relationship between the dollar and its trailing 200dma.

So far in this dollar bear to date, major dollar downlegs have tended to end when the currency was trading between 0.90x and 0.92x its 200-day moving average. The first and fourth major downlegs both bounced when the rDollar hit 0.905. The third ground a little lower to 0.903 before soaring higher in a spectacular bear-market rally in mid-2003. The only major-interim-bottom outlier was the second major downleg which ended a bit higher at 0.922 in relative terms.

This remarkably consistent dollar-bear performance is the primary reason why I don’t consider a major bear-market rally to be highly probable until the rDollar trades under 0.92 or so. As this graph indicates, the lowest the rDollar has traveled so far in our fifth major downleg today is only 0.949 carved on November 5th. If the dollar was to turn around here and enter major bear-market-rally mode, it would be the highest such interim bottom in relative terms in this entire bear to date. While a major bottom here is possible, it is just not very probable in light of precedent.

Thus, from a pure technical perspective the dollar ought to head lower in the intermediate term before we see another major multi-month bear rally. The dollar will probably head down near its lower support line as well as slumping down under 0.92x its 200dma before today’s fifth major downleg fully runs its course. With its current 200dma, this would yield a major interim bottom in the US Dollar Index under 81, or at least 4% lower from here.

And if we consider fundamentals, the long-term outlook remains bearish just like the intermediate term. The goofy US Fed continues to create fiat dollars out of nothing at a relentless pace. As this printing-press inflation leads to relatively more dollars chasing relatively fewer goods, services, and investments, the value of the dollar falls. The Fed is also encouraging foreigners to sell dollars by keeping US interest rates artificially low to subsidize wanton American debtors. All of the Fed’s current policies are virtually assured to continue weakening the dollar.

Not wanting to be outdone by the Fed, the Washington bureaucrats are also doing everything in their power to weaken the dollar. The US government continues to spend far more than it can steal from Americans via brutally excessive taxation levels. The huge structural deficits Washington insists on running are eroding America’s credit and standing in the world. In addition, Washington’s newfound love of imperialism is spawning great antipathy worldwide. Until these fundamentals change, the dollar bear will likely remain in force.

Furthermore, in the past few decades secular bulls and bears in the dollar have tended to run for 5 to 7 years before maturing and reversing. Our current specimen remains quite young by this standard, barely three years, so duration precedent also supports the bearish fundamental outlook on the dollar in the years ahead.

In light of these intermediate-term technical and long-term fundamental situations facing the mighty US dollar, it looks like the dollar shorts still have the upper hand in probability terms. Yes, the dollar bear’s notoriety in the mainstream is growing, but apparently not enough mainstreamers are ready to put their money where their mouths are on this so far. The popular noise on the dollar bear ought to get a lot louder before a major interim bottom materializes.

In early 2004, near the last major interim low in the dollar after downleg 4, the raw level of dollar bear notoriety greatly exceeded what we have seen in the recent weeks. In early January I wrote, “The relentlessly plunging US dollar is the primary topic of some of the most widely played financial-news stories these days. This once mighty American currency is rapidly falling from international grace, and even conventional media outlets are focusing more and more on the enormous implications of the down-spiraling dollar. ... With the dollar’s plunge now headline financial and even general news across the globe, one of the most popular bets around these days is to short the US dollar.”

We haven’t yet reached the everyone-shorting-the-dollar stage this time around, but odds are we will before the fifth major interim bottom of this secular dollar bear is carved. When the growing media hype surrounding the dollar bear is eventually backed by a massive surge in dollar-short plays by Wall Street and the mainstreamers, then contrarians will really have to take note. For now though, this fifth downleg does not appear to be in jeopardy of spiraling out of hand.

With the probable intermediate and long-term scenarios addressed, that leaves the short-term. Our next chart encompasses just the past year or so, the small blue-shaded area in the lower right corner of the graph above. Interestingly, while the dollar looks bearish in the months and years ahead, the outlook over the next few weeks actually looks bullish.

[Blockierte Grafik: http://www.lemetropolecafe.com/img2004/Zeal111204B.gif]

US Dollar Bear Notoriety

The very foundation of contrarian investing is the premise that the crowd is always wrong near major market turning points. Contrarian investors carefully watch the thundering mainstream herd, noting the dominant popular trading bias, and then consider taking the opposite side of these trades.

The legendary Warren Buffett, the premier contrarian of our time, summed this up beautifully with his famous words, “Be brave when others are afraid, and afraid when others are brave.” I have been thinking about this timeless wisdom a lot lately as I ponder the US dollar’s behavior since the elections.

Since early November, the popular notoriety of the ongoing dollar bear has exploded. The fact that the US dollar is in a secular bear market is certainly nothing new. I first wrote about the coming dollar bear in the summer of 2001 a month after the dollar’s secular top, and have been analyzing this dollar bear periodically ever since.

Back in the early days of this dollar bear, this whole idea was an incredibly heretical thesis. Outside of the small band of hardcore contrarians and battle-hardened gold investors, few believed a dollar bear was even possible since the mighty dollar was the world’s reserve currency. Surely no foreigners would ever be so brazen as to actually sell the dollar, right? Wall Street and the mainstream scoffed at the mere suggestion that the dollar was rolling over into secular bear mode.

How times have changed three years later! Now you can’t even open a financial newspaper or watch a financial news show without hearing about the dollar bear. My desk is literally covered with various dollar-bear articles from Bloomberg, Reuters, and major US newspapers, all published this week alone. Even the US Treasury was trotting out a parade of toadies in recent days to solemnly reassure the world that “the strong dollar policy of the United States remains unchanged”.

The dollar is definitely in a secular bear, but the popular notoriety surrounding this event is certainly in a bull market these days. As a belligerent contrarian, few things make me more nervous than suddenly finding myself in a position where the mainstream starts to agree with my trades. Buffett warned us to be brave (buy) when others are afraid (selling), and popular fear surrounding the dollar bear is surging.

In light of this latest market fashion of jumping on this dollar bear bandwagon, I would like to update my dollar analysis this week. Even with the dollar bear’s immediate notoriety growing, examining the perpetual greed and fear cycles in the dollar is always complex. Long-term and short-term sentiment waves cascade into each other and overlap, sometimes leading to very different outlooks over various future time frames.

We’ve built two new dollar bear charts this week, the first strategic and the second tactical in focus. On both charts the usual US Dollar Index data is superimposed over the Relative Dollar, or the dollar divided by its 200-day moving average. This rDollar indicator has been remarkably accurate in calling major interim bottoms in this dollar bear so far and it offers many insights into the probability of another major bottom brewing today.

By considering the dollar in both strategic and tactical technical terms in light of its recent surge in popular notoriety, contrarians can gain a much better idea of its most probable future course lying ahead over the short, intermediate, and long terms.

[Blockierte Grafik: http://www.lemetropolecafe.com/img2004/Zeal111204A.gif]

Conclusions

The information above seems to confirm our previous bullish case for Palladium. However it has now provided us with a larger view, which means that technically we could pull back all the way to 160-170 and still be in a major up trend (A situation we would not be looking forward to but must be open to).

It also means that very soon it will pay for overseas subscribers to switch to Dollars or move some of their money into dollar denominated assets. US citizens and residents you already own the dollar so, what palladium and the dollar charts could be indicating is that carrying debt could be more expensive.

Gold, a very tricky situation; palladium can go up with Gold, but to date the Dollar and Gold have not been able to trade in the same direction. So as far as Gold bullion is concerned, it could mount a significant rally if the dollar were to repeat its performance from the middle of 1991 to the middle of 1992. This is where the dollar after mounting a nice rally brutally corrected and took out its previous lows. Gold did not react, as one would expect to such a powerful down move; the dollar corrected from 98 to 79 (19 points) and Gold only jumped up from 350-380 (a mere 30 dollars). Since the situation is a lot graver now than then, Gold should react in a more violent way if the dollar were to correct in such a manner. The 425-430 ranges have been a source of serious resistance for gold since 1990, if we break past that and hold, the next real resistance only appears at 500.

This is one of the most complicated and most difficult situation we have had to ever analyze. The clearest pattern is that of Palladium and the Dollar. As far as Palladium goes it has started a new major trend change and the dollar is in the process of beginning one.

Gold on the other hand is already well into its trend change and such has the potential to correct to its main trend line and even dip briefly below it. So in terms of risk to reward based on current prices, Palladium is a far better play than Gold Bullion. We will update our outlook on this metal in future updates, however there will be some lag time as we have to cater to subscribers first.

[Blockierte Grafik: http://www.lemetropolecafe.com/img2004/GPDOL/image004.gif]

This chart provides additional information as you can see the Macds are at the most oversold point ever in the history of this contract. If you go to the first chart you will notice that the Volume has been very strong in this up move that started in 2003 (from the 140-150 price ranges)

All these charts seem to confirm that palladium appears to be a very good long-term investment. The only problem with palladium is that one has to know when to bail out as the final stages of the move occur very rapidly and end just as fast. We will use our indicators to guide you out when the time is right.

Out of the three charts, Palladium is the most oversold, followed by the Dollar; Gold bullion is the least oversold (we are talking about Gold bullion and not Gold shares many of which are already very oversold)

The average man does not know what to do with this life, yet wants another one which will last forever

Anatole France 1844-1924, French Writer

Now let’s tie in all these relationships.

Both palladium and the dollar started to rally from around the middle of 1992; Palladium unlike the dollar was able to maintain it’s up trend line. The dollar kept battling within the channel to find a direction. The moves in the channel were by no means small; a range of 80-96 is not a small movement. It appears that Palladium led the dollar in terms of strength; its move was a precursor to what the dollar would do in the future.

Moving on: The real true break out for palladium came in 1997; once again it led the dollar, which only really broke out in 1999 (from 1997-1999 it was forming another channel). However once the dollar really broke out in 1999, palladium went ballistic with the dollar; from 260 it powered of all the way to 1040 and the dollar from 96 went all the way to 122.

This is what we found surprising and only discovered when we were looking at very long term charts.

Palladium seems to work in tandem with the dollar for the most part, which means it works in the opposite direction to what Gold is doing. This can be clearly illustrated not only in the break out phase of palladium but also in the corrective phase. Throughout the palladium bull Gold was essentially correcting and when palladium broke out in 1997, the bottom dropped out for Gold. If history is any indication of what the future might hold, then it appears that once again Palladium has led the break out. Its downtrend was broken in the middle of 2003, while the dollar is still trying to break out of its down trend line.

If the pattern is to be repeated then the dollar will attempt a rally now (since these are long term charts do not expect something overnight), which will initially fail, while palladium keeps slowly moving up. Look at the periods from the middle of 1992 to the 1997; while palladium slowly kept going higher, the dollar was bouncing up and down in a wide range. These up and down movements were pretty huge; the top of the range was 98 and the bottom of the range 80 or so. This is not something small and in terms of futures represents thousands and thousands of dollars in profits or losses depending on which side of the trade you are on. Those performing a simple currency exchange (changing euros, Oz dollars, Swiss francs etc) would also feel some pain initially. We need to watch palladium closely as it seems to be a lead indicator to what the dollar is going to be doing in the future. If palladium is pointing to a stronger dollar, the following conclusions can be drawn

1) That Palladium is seeing a stronger world economy (meaning that even if the US has anemic growth, the world could take up this slack. Since Palladium is mainly used in the auto industry, we are only concerned with this aspect when we talk about the world economies.)

2) That Palladium will lead the way slowly at first, with the dollar rallying and correcting till it finds its way as it did in 1997.

3) There were times when palladium and Gold traded in tandem, while the dollar was correcting. In 1993, both Gold and palladium rallied and finally Gold broke down, while palladium carried rallying on. From 1989 to 1991 both palladium and Gold corrected in sync, then they parted ways as palladium started putting in a base formation, while gold carried on correcting. The same thing is happening now; from 2003 Palladium has been rallying with Gold. If history is to repeat itself then at some point in time they will have to part ways. Since Gold bullion is up approx 71% from its low, it has a better chance of correcting than palladium.

As you can see the data we are looking at is extremely complex and almost provides for contradictory scenarios. Right now we are not assuming much but just reading what the charts are saying, later on we will finish of with our assumptions.

Let’s zoom in a bit and examine the range bound movement in the dollar from 1991 to 1997. First of all we don’t think we will enter such a long phase this time but examining this situation does provide some clues for the future.

The dollar started to mount a rally in 1991 after putting in a low around 80-82 and this rally was rather strong; it took the dollar all the way to 98. After that the dollar started to brutally correct and put in a new low just below 80. Now we could be entering such a phase, the dollar has mounted its first rally and might even rally a bit higher, it could then correct and put in a new low just as it did back in middle of 1992 before taking off again. This means that Gold will initially pull back but then as the dollar corrects hard, mount a pretty sizeable rally. Then the bottom would most likely drop out for Gold Bullion and it would brutally correct. It would not be inconceivable to see a 50% pull back which would mean a correction to the 375 ranges or lower. The dollar then would start a new long term up trend journey just as it did in 1995. Palladium would really start to accelerate its move up, once the dollar was in full swing as was the case in 1999.

We have taken so much time to look at these relationships, because they are extremely complex ones that have occurred over large periods of time. The most complicated part is how deciding how to position ourselves for this situation; knowing that there are going to be periods of extreme volatility in between.

Gold

Gold bullion has been in an up trend for 3 ½ years now, without a serious correction. The main up trend line has not been breached and is a zone that currently provides incredibly strong support. If we were to break through this support zone for more than a few weeks, then the top of the channel (not drawn in) around 300-320 provides a fortress of strength.

[Blockierte Grafik: http://www.lemetropolecafe.com/img2004/GPDOL/image003.gif]

Dollar

The dollar was in a channel formation from 1991 to 1997, (It was possible to play the up and down moves in this channel formation using multi time frame analysis as these charts have a lot of data compressed in them). Technically the dollar started rallying from 1995, as the up trend line within the channel formation was never breached, unlike the previous attempts. The main stage however began in the 1997-1998 period and it continued to rally up to 2002. From 2001-2002, the dollar was doing nothing but topping and issuing strong signs that it was ready to start correcting. Now play close attention to this part. In about 2 years the dollar lost all the gains made in 7-8 years; now that is what you call a vicious correction. It only stands to reason that some sort of counter rally is to be expected. Look closely and you will notice that the dollar actually peaked in 2001 and was struggling to take out this high in 2002 without any success. From its peak in 2001 to its low in 2004, the dollar lost approx 31% of its value. Gold from its low in 2001 to its high in 2004 gained approx 72%; so investing in Gold bullion more than made up for your loss in purchasing power.

Notice to that the dollar has not taken out its 1986 high of 128 and is therefore technically still in a downtrend pattern. I did not put the downtrend line here, but it was included in the mid week update.

We have just broken the long term down trend line. Note that Gold initially broke its long term down trend line in 2000; it was unable to stay above it and ended up testing the lows once more before mounting a very nice rally. There is a strong possibility that the dollar could do something similar and just maybe even test the major support Zone at 80 (if it did this, it would most likely do so on some positive divergence, i.e. lower price and higher macds or RSI, or Stochastics or a combo of all three). It is for this reason that we expect this trade to be very volatile in the initial stages.

[Blockierte Grafik: http://www.lemetropolecafe.com/img2004/GPDOL/image002.gif]

Palladium

Palladium was in channel formation from 1991-1997. As we have stated before the longer the channel formation the more explosive the upward movement. When it broke out of the channel the price was 140, about 3 ½ years later it traded as high as 1040 dollars. Since 2002 it has been undergoing a brutal correction. It corrected all the way back to 140 and the support line held. One of the best times to invest in a sector is when it is has been beaten down to death and the reasons just don’t add up. Unless we stop manufacturing cars tomorrow, Palladium is always going to be needed. At current prices and taking inflation into consideration, palladium is trading 20-30% lower than it was trading in 1997.

It did break its main up trend line briefly in 2003, but as we stated before a brief penetration of the up trend line is normal many times. There is also a way to deal with this situation very effectively. When the main trend line is broken in a very long-term chart such as this, you then switch over to a different time frame (that’s where multi time frame analysis comes in) and to determine whether you should stay in or bail out, but that’s another topic.

[Blockierte Grafik: http://www.lemetropolecafe.com/img2004/GPDOL/image001.gif]

Promises To Pay

When I sit down and think about what a dollar really is; I am amazed at how simple the answer is. In simple terms a dollar is a “Promise To Pay.” When examined from this point of view one begins to understand to true meaning of deficits. Now compound a promise to pay, one trillion times, seven trillion times or fifty trillion times. Gets a little frightening doesn’t it?

When the owners of those “Promises To Pay” finally decide to collect on their debts what will they decide to settle for in payment? What do they want, as final payment, for having been so kind by accumulating our debt for all these years? The important point to remember is the fact that they have not been paid but only accepted a “Promise To Pay” as a pacifier for their goods and services. The story gets a little interesting when we look at it from this perspective. Just what could these owners of our “Promises To Pay” buy with their paper? I think the answer is anything they want! I think it is important to realize that the dollar is not payment but a pacifier until the possessor of that dollar decides what he wants to ultimately take in exchange for his products and service.

Now take a society that has temporarily lost its mind and gone on a buying binge where they are buying foreign goods and services at a deficit rate of $1.5 billion “Promises To Pay” everyday. Just exactly what are these people buying that is so important in their daily lives that they will eventually be selling their most prized and valuable assets, down the road, in exchange, to settle these outstanding “Promises To Pay?"

The most frightening point to this whole topic is the choice that the owners of these “Promises To Pay” will have when the time comes to rid themselves of these promises. These entities will have the option to purchase anything they want Will they be like the consumers in the U.S., a kid in the candy store, or will they be intelligent and purchase the items that they will absolutely need to maintain or achieve the standard of living they now have or want to achieve? My suspicion is that they will understand what they need and make very prudent purchases.

In today’s world, nations are approaching a point in time where the true leaders recognize the shortcomings of their nations and are taking the appropriate steps necessary to guarantee that their people have a sufficient supply of natural resources to meet the growing demands of their people. This new supply shall be purchased with the hoard of dollars that they have now accumulated.

China has made a $5.5 Billion bid to buy Noranda. They are going after the largest mining company in Canada and they are only spending a small fraction of the “Promises To Pay” that they have accumulated. We bought worthless toys and widgets from them and they are now buying hard core, and might I say “dwindling supply” natural resources from the rest of the world. I think that the exchange of widgets for natural resources will be of much greater benefit to China than the U.S.

We have now approached a point in time where these holders of our debt are seeing the writing on the wall and they have decided that now is the time to begin to cash in their paper. The only recourse our officials have to stop this redistribution of assets is to tempt these people with a sweeter pacifier; this pacifier is rising interest rates. The only tool left to postpone this liquidation of dollars and subsequent purchase of natural resources is rising interest rates. How high will the rates ultimately go? I think a whole lot higher than the masses, who are buying these toys and widgets, can even begin to comprehend. I believe that the next five years will bring about dramatic changes in our lives and the purchases that we make. I believe that five years from now, as we compete for a supply of oil and natural resources that are simply not there, we will fully regret the day that we outsourced our manufacturing facilities and our jobs to these foreign countries.

The only way out of this mess, from my perspective, is the create something that the rest of the world must buy from U.S. I see the U.S. developing into a service sector attempting to absorb all the lost manufacturing and financial jobs of the past. The problem with the service sector is the fact that this does not create wealth but redistributes wealth.

I see true wealth as being created, through the making of goods, which is manufacturing; the growing of crops, which is agricultural; the creation of technology and the mining of natural resources. I am sure there are other areas but I hope I have been able to get my point across.

The more outsourcing that goes on in the U.S. the more wealth creation we send overseas. Personally, I hope we come to our senses and change the pattern of the future; if it is not already too late.

Hopefully, I have the problems of my e-mail list fixed. I have sent out two updates, if you have not received them then you need to contact me. Likewise, if you want on the list then, just e-mail me. Sorry for any inconveniences.

Mike,

mhoy@neb.rr.com

News von Fronteer ...

Gruß
Schwabenpfeil

http://home.businesswire.com/p…68105982&viewID=news_view

November 15, 2004 10:52 AM US Eastern Timezone

Fronteer Adds Silver Discovery to New Gold Zone in Western Turkey VANCOUVER, British Columbia--(BUSINESS WIRE)--Nov. 15, 2004--Fronteer (TSX:FRG) is pleased to announce it has intersected 588 g/t silver and 0.5 g/t gold, for a combined result of 10.5 g/t gold equivalent over 15.4 metres from drill hole AD-105 on the Agi Dagi Project. Drill hole AD-105 is situated 137 metres to the south of previously announced hole AD-92, which was also rich in silver, returning 3.0 g/t gold equivalent over 51 metres. Fronteer also announces that it has intersected 37.9 metres of 1.5 g/t gold equivalent in hole AD-108, situated 100 metres to the north of hole AD-92. DELI ZONE DRILL HIGHLIGHTS-------------------------------------------------------------------- Gold Silver GoldHole ID From To Width Grade Grade Equivalent (m) (m) (m) (g/t) (g/t) (g/t)--------------------------------------------------------------------AD-105 18.5 43.1 24.6 0.3 398.0 7.1 incl. 23.6 39.0 15.4 0.5 588.0 10.5AD-105 92.7 112.9 20.2 0.95 0.8 0.96AD-92 49.5 100.5 51.0 2.3 41.0 3.0AD-108 167.7 205.6 37.9 1.3 7.5 1.5--------------------------------------------------------------------Values for gold equivalent were calculated based on a gold price of$428 and a silver price of $7.30.Based on results to date, precious metal mineralization has been intersected in six widely spaced holes over a length of 500 metres, running north to south across the northeast end of the property. Additional holes in this new discovery zone (called the Deli Zone) are currently being completed and assay results are pending. Fronteer has had rapid success in expanding the resource potential of the Agi Dagi Project. Drilling in the Deli Zone has intersected thick intervals of near surface oxide mineralization, with shallow geometries favorable to open pit extraction. The Deli Zone has the potential to match or exceed the size and grade of the historic resource area, located at the southwest end of the property. The Agi Dagi Project is under option from Teck Cominco Arama ve Madencilik Sanayi Ticaret A.S. Fronteer is a Discovery-Stage exploration company with active exploration programs in Canada and Western Turkey, focused on gold and uranium deposits. Assay results have been prepared under the guidance of Dr Rick Valenta P.Geo, who is designated as a Qualified Person with the ability and authority to verify the authenticity of and validity of this data. All samples were analyzed by ALS Chemex, North Vancouver, BC, using ICP-AES and fire assay. This News Release includes certain "forward looking statements" within the meaning of the United States Private Securities Litigation Reform Act of 1995. Without limitation, statements regarding potential mineralization and resources, exploration results, and future plans and objectives of the Company are forward looking statements that involve various degrees of risk. The following are important factors that could cause Fronteer's actual results to differ materially from those expressed or implied by such forward looking statements: changes in the world wide price of mineral commodities, general market conditions, risks inherent in mineral exploration, risks associated with development, construction and mining operations, the uncertainty of future profitability and the uncertainty of access to additional capital. Fronteer Development Group Inc. (TSX:FRG)

Hallo Hpoth,

ich freue mich, dass Du hier noch weiterhin vorbeischaust und Dein Musterdepot aktualisierst ...

Gruß
Schwabenpfeil

Zitat

Original von Silbertaler

Kalle, ich habe den Eindruck, dass es hier im Forum in letzter Zeit etwas ruhiger geworden ist, wenn man mal die Arbeit von Schwabenpfeil ausnimmt. Der Aderlaß von Leuten, die tiefer in der Materie stecken und auch weitergehende Informationen liefern, ist schon bemerkbar und nicht so schnell zu ersetzen. Auf der anderen Seite lese ich mittlerweile bei silberinfo mit. Von daher entgeht mir nichts.

Hallo Silbertaler,

klar fehlen uns die alten Fahrensmänner und Boardexperten. Irgendwie ist die Situation ja schon komisch: Die Häuptlinge fast isoliert bei Silberinfo; die Indianer bei Goldseiten.

Gruß
Schwabenpfeil