You have to admit that I hit a home run with my call last week regarding the short-term top that the Gold market made on 2/20.  But forget that.  What you really want to know is when will Gold make a bottom and resume its upward climb.  That’s an excellent question!  Here’s my take on the market after today’s losses.  I told you last week that I would update you after the close on Friday but I wanted to wait one more day because, after Friday’s mess, I wanted to see if today would bring any kind of rebound.  It did not.  The April Gold contract finished Friday’s session at $942.50 and then lost another $16.20 today to close at $926.30.  If you didn’t take my advice and held your long Gold position last week, you can’t be feeling very good about yourself right now.  I understand that people hold their Gold for a variety of reasons and I respect that.  Some of you aren’t interested in “trading” precious metals.  I respect that also.  The reason I’m not concerned for anyone that is holding on to their physical metals at this juncture is because I believe that higher prices lie ahead.  If and when the day comes that I feel a change in the major trend is imminent I promise that I will sound the siren until everyone has heard my warning.

For now, let’s look at the current technical condition of the Gold market and see just where it stands.  The market is down just over $80 from its recent peak at 1007.70 and looks to be headed for the $886.00 area which would be a Fibonacci retracement level of 38.2%.  This would be a very logical place for this decline to end because it corresponds closely with the December high at 892.20.  None of these numbers ever end up being precise so my rough estimate would be for the market to see a decline to the $875-885 level before this wave bottoms out.  This would put the market back into a highly oversold condition and should provide the fuel for the next advance.   Now, I’ve told you many times that I don’t like to project where markets may be going because, frankly, I don’t have a clue.  But I believe this next wave will be far more ferocious than the move that took Gold from just below $700 in mid-November to the recent high above $1,000.  I also believe that this next move will take Gold to new all-time highs.  How high will it go?  Well, I always say that if you put a gun to my head I’d give you my best guess.   And my best guess is that we’ll probably see Gold trading up to at least the $1,200-1,300 level before any real selling is encountered.  The psychological significance of a new all-time high, in light of the current meltdown that the equity markets are experiencing, could catapult the Gold market significantly higher than my estimate.  So, for those of you who are holding through to the end I say, no harm, no foul.  But remember – there will be a day of reckoning as there is with all Bull AND Bear markets.  I’ll do my best to get you out as close to the top as is humanly possible.

Good trading,

Dale F. Doelling, Chief Market Analyst
info@Bullion.com
1.888.453.4614  Ext 2

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 you want to know which individual asset led the field in January then look no further than this post.  As the S&P was posting its worst January ever with an 8.8% decline, Gold, that precious yellow metal, was kicking some serious butt in January.  Certainly you must know by now that I’m a Gold Bull.  I don’t make that statement recklessly.  I analyze markets for hours on end looking for reasons to be LONG or SHORT.  I have only been SHORT Gold once in 4 years.  We’ve been through a series a “bubbles” beginning with the Dot.com bombs of the 90’s.  Then it was Real Estate.  The next is probably going to be the Treasury market but that’s only going to happen when the markets truly believe that the deflationary cycle that we find ourselves in has run its course.  The commodities markets are just getting started.  I’m talking about incredible gains in commodities that we will see over the next 5 years.  In November, I told Marketwatch.com’s Myra Saefong that Gold and Treasuries were the only safe place for people to put their money.  Gold was trading just below $700 and the 10-Year Notes were yielding just under 4%.  Today, Gold is trading above $925 and the 10-year yield has declined to 2.856%.  Do you know what a $25K investment split between Gold futures and Treasury futures on November 1st would be worth today if you had leveraged your account equity at 50%?  The answer is – over $100K or a 400% cash on cash return in 3 months.  Not too shabby!

So, there’s the key.  We all know that leverage is a double-edged sword.  Now, the futures markets are zero-sum game where for every buyer there’s a seller and for every winner there’s a loser.  Leverage, on the other hand, magnifies the movements of the markets.  If you are riding a winning trade pyramiding your  position can produce incredible returns.  And when markets are in firmly entrenched trends like Gold you have to force yourself to stay with the trend.  This kind of discipline is absolutely crucial in order to take full advantage of these large market moves.

Good trading,

Dale F. Doelling, Chief Market Analyst

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.

Hello!  I’m Dale Doelling and this is my first post on the Bullion.com blog.  I’ll be providing market updates to the Bullion.com blog every Tuesday evening so, if you have any questions or comments, you can post them here or send me an email at Dale@DaleDoelling.com

Before I talk about what may lie ahead for the markets I’d like to recap what has happened over the last 12 months.  During 2008, we saw record highs in Gold and Platinum but Silver lagged behind the entire year.  Let’s look at a weekly OHLC chart for Gold and Silver and see if anything stands out.

Weekly Gold

As we can see in the chart above, Gold has traced out a very nice 5-wave decline from the March high to the October low.  On November 13th, the December futures were trading just below the $700 mark and, in the Metals report on Marketwatch.com, I stated that I was expecting a rally in Gold to at least $900.  It took just 8 trading sessions for the market to rally to an intraday high of $833.50.  The February futures hit an intraday high of $883.60 on 12/17.  Although the market has pulled back a bit, mostly due to Dollar strength and weakness in Oil, I still feel there’s at least a 70% chance of the Feb contract eclipsing the $900 mark before the end of the year.

Silver has been a disappointment as it retraced nearly 60% from its July high to its low in October.  But, just when it looked like there would be no bottom, Silver found support and has now made a very nice rounded bottom on the weekly chart and could challenge initial resistance at around $11.00 in the first quarter of 2009 and possible eclipse major resistance at around the $12.35-12.50 area.  Consecutive closes above that level could propel the Silver market right back to the 2008 highs in a hurry.

Weekly Silver

I believe that the Precious metals group will be the #1 asset class based on performance for the next 24-48 month period.  I base that on my assessment of the Dollar, which I believe may have already begun its next big leg to the downside.  I also continue to believe that the length of time that it is going to take for our economy to recover is being prolonged by the actions of our Federal government to the detriment of the working class in this country and this may eventually lead to some form of Martial law in this country as more and more people are forced on to the streets.  Our economy is about to enter a new phase that I believe will be the worst period that this country has ever experienced.  I talked about this over 3 years ago in my interview with Jon Nones at ResourceInvestor.com and everything that I said then, i.e., a falling stock market, the real estate market crash, and the Debt crisis that is being exacerbated by our government every day, has come to fruition.  I will continue to monitor the crisis and report back to you, our readers, every Tuesday evening.  We will be scheduling Webinars for Precious metals investors and we’ll be looking at the opportunities in Gold, Silver, Platinum and Palladium as they present themselves.  I look forward to helping you in achieving your financial goals in the coming year.  It should be interesting!

In closing, I would like to say how elated I am to be associated with Bullion.com.  I believe that during the coming year you will find what you are looking for regarding the Precious metals markets and you’ll invite your friends to subscribe to our newsletter. I welcome your comments and questions and I will try to answer as many of your emails as time permits.

Good trading,

Dale F. Doelling
DaleDoelling.com

DISCLAIMER

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.