It’s Monday morning, January 26th, and I’m sitting here wondering what happened to January!  I’ve just had too many things to deal with this month.  My son’s High School basketball team is looking to go to the State tournament and he breaks his leg in a game two weeks ago.  The good news is his doctor says he’ll be ready to play again by the last game of the regular season.  Then my wife and I are helping with the planning for our daughter’s upcoming wedding in March.  I could go on and on but, suffice to say, things have been hectic around here.  So I’m going to make sure that I get my posts submitted in a timely manner because the markets don’t wait for anyone.

In my last post on January 14th, I gave you some areas of support for the price of Gold.  In retrospect, the one that I considered least important, $800, proved to be the one that actually held the market up.  The FEB Gold contract fell to 801.50 intraday on January 15th, the day after that post.

It has rallied over $100 since that time, or about 13%.  Now, for those of you who are long-term holders of gold, you’re doing just fine.  If you trade the markets on a more frequent basis then you possibly missed an opportunity to get long this rally at a bargain price.  I exited my short-term Gold positions when FEB Gold posted consecutive closes below support at 829.80.  The fact is, the market gave me a headfake and I took the bait!  I really thought the market would need to break the $800 barrier to flush out some weak longs but that was just not the case.  I got back on the long side when the market posted consecutive closes above previous support, which then became resistance, or at a price of 848.50.  Since I remain a long-term BULL on the Precious metals and because I truly believe that the worst is still ahead regarding the economy, I am committed to building a large position in Gold as the market moves higher.  This is a trading strategy that I have employed for years.  I simply scale into and out of a trade as the market moves in my favor.  The goal of a trend follower is not to buy low and sell high.  A Trend Follower buys High and sells Higher or sells Low and buys Lower.  Now that Gold has shown that it can rally in spite of a stronger Dollar this can only be BULLISH for Gold and the other metals. How much higher do I expect Gold to go?  Well, if you put a gun to my head I’d say that Gold has significant upside potential.  If you threatened to pull the trigger, I’d tell you that I expect Gold to eventually top $2,000.  Things are going to get pretty ugly.  Those who have prepared themselves are certainly in the minority.  The masses are asses and they are looking to the Federal government for a handout.  That’s what they’ve been conditioned to do since the days of LBJ.  The proactive folks (that’s you and me!) have prepared for the worst and have quietly built a stash of bullion coins for the day when our fiat currency no longer is accepted in many places.  Continue to accumulate Gold and Silver on pullbacks and keep a long-term perspective.  It should pay huge dividends for you.

Dale F. Doelling, Chief Market Analyst

The information and comments contained herein are provided by Secure Future Financial Corporation
(”SFF-CORP”) and NOT Castello Cities Internet Network, Incorporated. Futures and
options trading involve significant risk of loss and may not be suitable for everyone.
Therefore, carefully consider whether such trading is suitable for you in light of your
financial condition. This report includes information from sources believed to be reliable
and accurate as of the date of this publication, but no independent verification has been
made and we do not guarantee its accuracy or completeness. Any reproduction or
retransmission of this report without the express written consent of Secure Future Financial Corporation
is strictly prohibited. Again, the information and comments contained
herein is provided by SFF-CORP and in no way should be construed to be information
provided by Castello Cities Internet Network, Inc. Copyright © Secure Future Financial Corporation.

The Precious metals markets normally trade higher when there’s nothing but uncertainty regarding the direction of the markets.  But toss a hint of Deflation into the mix and we’re talking about a whole new ball game.  That’s where we are now.  As we move farther down this road toward complete financial collapse the big question is – How do we defend our net worth from the effect of a Deflationary cycle?  Real deflation, which is a phenomenon that most of us have never experienced, is a period of contracting prices.  The effect of deflation on the markets can be seen in the prices of Treasury securities since October.  As the market starts to recognize the fact that we have entered a deflationary cycle, market participants shun financial assets and commodities and move to bonds for safety.  It’s pretty obvious that the only asset class that has made any real advances recently are Treasuries.  The March 5-year Note futures have added 10 full handles since October 20th.  That equates to a $10,000 profit on an initial margin requirement of less than $2,300 for one futures contract.  That move in price brought the yield from about 2.97% in October and slashed it by over 50% to 1.328% at the close today.  If that doesn’t spell DEFLATION I don’t know what does.

So, here I am wondering just how low Gold is going to go.  $800 is psychological resistance but that’s not really support in my opinion.  Chart support lies at $780 and then just shy of $740.  But Gold could go much lower before people finally come to the realization that their Dollars ain’t worth the paper they’re printed on and rush to buy Gold, Platinum and Silver bullion and coins to stave off their own personal financial demise.  I know I didn’t expect Gold to break $830, but the markets have rarely given a rat’s pitoot what I think.  We’re dealing with the here and the now.  And right now, it’s not looking good for any asset class other than Treasuries.  The good news is that bond yields can only go so low and Gold can’t go below zero.  I remember back in the mid-80’s when Sugar was trading at 5 cents a pound.  This was my first commodities trade ever.  I remember thinking that Sugar couldn’t go much lower than 5 cents because producers would sooner dump their product in the lake than sell it for less than 5 cents a pound.  Well, I think you can guess the eventual outcome to my logic.  Sugar finally bottomed out at 2.7 cents.

Whether it’s commodity funds or individual investors, no one is willing to take a risk right now.  So I’m not real enthusiastic about the near-term prospects for Gold and Silver.  I said last week that consecutive closes below $830 basis the February contract would force me to exit my positions and that’s exactly what I have done.  I’ll be on the sidelines for the time being as the market could go straight to the major support at $780.  That would put Gold in a highly oversold condition and I’d probably opt to get long if the market action was encouraging at that point.  Also helping Gold’s decline has been the resurgence in the Dollar.  I don’t expect the Dollar’s rally to be anything but a short-lived event but I’m not going against the Dollar at this juncture.  The bullish tone is obvious and it may last awhile.  We’ll see how the rest of the week goes.

Good trading,

Dale F. Doelling, Chief Market Analyst

The information and comments contained herein are provided by Secure Future Financial Corporation
(”SFF-CORP”) and NOT Castello Cities Internet Network, Incorporated. Futures and
options trading involve significant risk of loss and may not be suitable for everyone.
Therefore, carefully consider whether such trading is suitable for you in light of your
financial condition. This report includes information from sources believed to be reliable
and accurate as of the date of this publication, but no independent verification has been
made and we do not guarantee its accuracy or completeness. Any reproduction or
retransmission of this report without the express written consent of Secure Future Financial Corporation
is strictly prohibited. Again, the information and comments contained
herein is provided by SFF-CORP and in no way should be construed to be information
provided by Castello Cities Internet Network, Inc. Copyright © Secure Future Financial Corporation.

If the first three days of trading in 2009 are any indication you could make a strong case that Gold is going to have some problems in the near-term.  We’ve seen the Dollar retrace better than 50% of its recent loss vs. the EURO since December 18th and, should that trend continue, it would definitely throw cold water on any hopes of an early 2009 rally in the Gold market.  Feb Gold traded all the way down to $838.80 at around 2 AM EST Tuesday morning. That’s a nearly 6% decline from the 12/31 close.  Once again, the selling was mostly dollar-based as the EURO broke through major support levels and dragged gold down with it.  But, the EURO found support and the Gold market took notice and, just when I started to get that empty feeling in the pit of my stomach, the markets began to slowly move higher.  After being down by as much as $19.00, Gold managed to close up $8.20 to $866.00 in Tuesday’s session.  And that means we’re still in pretty good shape, technically speaking.  We closed the year at $884.30, basis the February futures contract, and Gold has strong support in the $830 area as well as a rising 100-day MA at around $813.  This is why I’m  holding my long Gold position from mid-November because I never take profits until the market tells me to.  The biggest part of this next leg up may still lie ahead.  Today’s decline and subsequent rally back into positive territory bodes well for Gold and creates a more positive tone for the market for the rest of this week.  Only a reversal and decline below support at  $830 would create cause for concern.  Consecutive closes below $830 would force me to cover my long position.  If this were to occur, and I doubt that it will, the market would most likely test the 100-day MA before it found support.  One thing that I’m looking at closely is the recent retracement in the EURO.  The EURO, after getting hammered since its peak on July 15th, rallied all the way back to its 200-day MA on 12/18 but failed to close above that mark.  It has now broken down again and moved back below its 100-day MA today and is trading just above the 200-week MA at 1.3372.  That is troubling if you are looking for Gold to rally.  If the EURO can hold that level then we should see Gold rally.  If it is unable to hold at this level then the likelihood of further deterioration in the price of Gold rises substantially.

I hate to drag fundamentals into the fray but its difficult to ignore what’s happening in the Middle East.  The Israelis seem intent on using all of their might to derail the Hamas militants and I have no doubt that they will utilize every resource to accomplish that goal.  Most people would say this situation is supportive to the Gold market but it’s already been factored in.  Probably more important for Gold is the potentially devastating $2 trillion that will be added to the Federal deficit in 2009.  I’m sorry folks but that’s a number that simply can’t be ignored.  And, believe me, the markets won’t!  That said, we’ll continue to concentrate on what we do best and that is 1) find an appropriate entry point, 2) cut our losses quickly and 3) let our profits run no matter what our trading time frame is.

In review, I see a risk to the $830 area but will be surprised if we reach it and upside potential to $900+.  If the market is able to rally through $900 we’ll look to add to our position as the market continues to trend higher.

We’re planning an online webinar for those of you who would like to learn more about markets and resources for buying gold and silver bullion so make sure you check the Bullion.com website for more details.  We’re also working with a large Chicago-based FCM that would allow you to purchase American Eagle Gold coins directly through our website and we’ll have more information on that very soon.

If you have any questions or comments feel free to write me at dale@daledoelling.com

Good trading,

Dale F. Doelling, Chief Market Analyst

The information and comments contained herein are provided by Secure Future Financial Corporation
(”SFF-CORP”) and NOT Castello Cities Internet Network, Incorporated. Futures and options trading involve significant risk of loss and may not be suitable for everyone. Therefore, carefully consider whether such trading is suitable for you in light of your financial condition. This report includes information from sources believed to be reliable and accurate as of the date of this publication, but no independent verification has been made and we do not guarantee its accuracy or completeness. Any reproduction or retransmission of this report without the express written consent of Secure Future Financial Corporation is strictly prohibited. Again, the information and comments contained herein is provided by SFF-CORP and in no way should be construed to be information provided by Castello Cities Internet Network, Inc. Copyright © Secure Future Financial Corporation.

Happy New Year!  This has been one of the most interesting years in my 25 years in the Financial services industry.  I delayed publishing this week’s comments because I wanted to crunch the numbers for 2008 before we put forth a strategy for 2009 and beyond.  Gold, although higher earlier in the year, still managed to notch a 5.5% return in 2008.  We managed to do significantly better because we take both long AND short positions as the trends change.  But make no mistake.  The long-term bull trend in GOLD is intact!  I happen to believe that the next 24 months could bring new all-time highs in Gold as the fragile financial system fails to respond to massive injections of cash via the unprecedented government bailouts that have been proposed.  This will lead to new lows in the Dollar, a continued decline in consumer confidence, a deep and prolonged recession (or Depression) and a major rally in Gold as the focus moves swiftly to stores of value that stocks and bonds can not provide.

I’ve been criticized in the past for my writing style regarding the markets.  Some believe that I should try to be more “entertaining” when I try to explain the way markets move from a technical perspective.  Let me say this right up front.  I’m not interested in entertainment.  If I want entertainment I go to Vegas.  When it comes to the markets I’m only interested in one thing-  Making money!  Unless you are familiar with my work and my track record you may find it difficult to develop and execute a trading plan based solely on my opinion in this blog.  As a matter of fact, the development and implementation of a trading plan is the toughest thing for most investors to do and even more difficult for the novice trader.  On November 13th when Gold futures were trading just south of $700, I stated in a story on Marketwatch.com that I expected Gold to rally back to the $900 mark.  On Monday, FEB Gold futures hit $892.00.  Now, you might be inclined to say that I missed the mark.  And, you’d be right.  All I know is that I came close enough to my mark to bank some serious profits as Gold rallied to the close of 2008.  And that, my friends, is what trend following is all about.  The major trend in Gold is UP and this next leg up may be the most impressive.  So, take a portion of your investable dollars and invest it in Precious metals.  If I’m right, you’ll be smiling at this time next year.

I will add an additional segment to this blog after the close tomorrow as we look at charts on Platinum and Palladium and explore the profit potential of these markets as well.

I wish you all the best in 2009!

Dale F. Doelling, Chief Market Analyst

The information and comments contained herein are provided by Secure Future Financial Corporation
(”SFF-CORP”) and NOT Castello Cities Internet Network, Incorporated. Futures and options trading involve significant risk of loss and may not be suitable for everyone. Therefore, carefully consider whether such trading is suitable for you in light of your financial condition. This report includes information from sources believed to be reliable and accurate as of the date of this publication, but no independent verification has been made and we do not guarantee its accuracy or completeness. Any reproduction or retransmission of this report without the express written consent of Secure Future Financial Corporation is strictly prohibited. Again, the information and comments contained herein is provided by SFF-CORP and in no way should be construed to be information provided by Castello Cities Internet Network, Inc. Copyright © Secure Future Financial Corporation.