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March 29, 2006

A precious sunrise, Wed., Mar. 29, 2006, 5:40 AM

Overnight trading in the spot gold and silver market has been strong. There is now a consensus view among Wall Streeters that the FOMC will stop raising at its next meeting in six weeks. That plus a view that there will be no quantitative easing (i.e., there will be continued growth of the money supply), is serving to put upward pressure on gold and silver.

Although there has been a small pullback in the past 30-minutes, both charts (www.INO.com) show overnight strength leading into the London opening today. Every morning, I check these charts, as well as many others, at INO.com.

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1:00 pm Follow-up:

This is the "Precious Sunrise" I was painting at 5:00am this morning. It was dark outside, but I had that picture in my mind.

It looks good either in a 1-day chart (gold) or a 5-day chart (silver). Don't you think?

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Posted by Posted by Bill Cara on March 29, 2006 05:40:43 AM | Category: Bullion

Discourse

Looks like gold has recovered from an early morning low of about $560 spot. I would expect continued weakness of limited duration. I am looking for that downtrend channel to be broken.

I don't believe that rate hikes are through in May, especially if oil breaks out of its trading range here. I am watching it and bonds carefully to see gold's direction. Right now oil is off slightly.

Posted by: MarkM [TypeKey Profile Page] at March 29, 2006 6:49 AM [link]

The markets cannot possibly like the higher oil, higher gold, higher $USD combination. I wonder if they will be in the red by EOD.

Nice call on gold Bill. It came off to a little less than $5 but then has taken off northward again.

Posted by: MarkM [TypeKey Profile Page] at March 29, 2006 11:08 AM [link]