GOLD BREAKING OUT!
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As I write this, gold is up $40/ounce and is preparing to blow through $900.
As you can see on the chart of gold it is also well above the 50 day moving average and has also just cracked its 200 day moving average. If we can close above $900 I look for a fast move back over $1000/ounce and new all-time highs.
In addition, Gold has crossed "par" with the S&P 500, and the last time this happened was 1973. Over the next 12 months, gold tripled in price.
Market Update
The market continues to hold right at all-important technical levels, and with the solid earnings reports from tech leaders IBM, Apple, and Google, we have one more chance at a short term Obama bear market rally. On top of this, the beaten up financials have all reported their quarterly earnings, and as bad as they were, the market seems to want to give them (another) second chance. Remember, Obama’s economic team will be announcing their plan to save the economy in the coming week, and with this news could come a short covering rally, which might bring a quick move higher.
Nothing has changed my long term view that we are going to at least test the November lows of 7500 on the Dow, but even in a bear market it’s not uncommon to see bear market rallies.
Kip Herriage
Editor, VRA
