Gold Breaks $1,000 an Ounce; What's Next ...IMPORTANT INFORMATION BY A VERY ASTUTE ANALYST

MONEYANDMARKETS» Wednesday, September 9, 2009 YOUR BEST SOURCE FOR THE UNBIASED MARKET COMMENTARY YOU WON'T GET FROM WALL STREET [«] Money and Markets 2009 Archive View This Issue On Our Website [»] Gold Breaks $1,000 an Ounce; What's Next ... by Claus Vogt Dear Subscriber, Yesterday, gold broke the $1,000-an-ounce barrier, after rising from $950 per ounce last week. It was the precious metal's fifth run-up to the round number. And now there are many signs indicating that yesterday's decisive break is of major importance. Take a look at the following chart ... As you can see, from November 2008 through February 2009, gold rose from around $700 to nearly $1,000. The ensuing consolidation took six months ... and ended last week. This consolidation has the form of a triangle, which typically confirms a trend. With last week's strong breakout above the upper boundary of this triangle, a clear buy signal was generated. And that explains gold's move above $1,000. Now, Momentum Indicators and Price Targets Point to More Gains Ahead ... The high momentum of this move is bullish. In spite of this healthy thrust, medium-term momentum indicators are not yet overbought. As you can see in the lower panel of my chart above, the price momentum oscillator (PMO) is still in neutral territory and just starting to turn up. In my opinion, that means there is a lot of room for additional price gains. Internal Sponsorship Last days to go for huge gains in China and Asia! Time is running out to get our free report on how China, Asia and other emerging economies are growing like wildfire! Other investors are already harnessing this historic profit potential. We want to show you how the emergence of new economic superpowers gives you not just one, but THREE ways to profit! Click here to learn more ... Sentiment indicators point in the same direction. Last Thursday, the Hulbert Gold Newsletter Sentiment Index stood at just 25.2 percent, which is a very low reading. During gold's previous rallies to the $1,000 mark, this sentiment indicator stood at 61.8 percent on average. The high skepticism greeting the current rally is very bullish from a contrarian standpoint. So how high could gold go from here? Well, the width of that triangle formation can be used to calculate a minimum price target. It's around $1,100. A 10 percent move may not sound too exciting, but it's just a minimum target. Plus, there is a very important additional message coming with this price target ... A Rise Above the Resistance Is Extremely Bullish You have to step back a bit and look at a longer-term gold chart to realize the significance of a clear break above the resistance zone around the $1,000 level. Here's a weekly chart ... As you can see, gold started a huge consolidation period in March 2008. It reached a low of approximately $700, which is a clear support area. Then it moved back up to the $1,000 level. This whole movement can be seen as nothing more than a typical correction taking place during a long-term uptrend. A break above its upper boundary around the $1,000 level signals the end of this huge consolidation and the start of the next medium-term uptrend. The minimum target of this larger formation amounts to $1,300. And since gold is in a long-term bull market, I see even this area as just an interim target. Longer term I expect much higher prices. Here are the reasons why: Numerous fundamental factors all but guarantee higher gold prices. As a consequence of the current financial and economic crisis government debt is going through the roof — not just in the U.S., but all over the world. Worldwide central banks are printing money like there is no tomorrow. Gold demand is rising due to rising wealth in emerging economies where the yellow metal is still favored as a store of value. Gold supply is stagnating or even slightly shrinking — despite the metal's price rise since 2001. This is because it's getting ever more difficult and expensive to get gold out of the earth. Finally, central bankers who were very eager to sell government gold at much lower prices a few years ago are getting increasingly reluctant to keep doing so. Emerging market central banks are even buying. So with this important technical breakout now behind us, and these fundamentals in place, I expect the long-term bull market to continue. Much higher highs are very likely. Best wishes, Claus About Money and Markets For more information and archived issues, visit http://www.moneyandmarkets.com Money and Markets (MaM) is published by Weiss Research, Inc. and written by Martin D. Weiss along with Nilus Mattive, Claus Vogt, Ron Rowland, Michael Larson and Bryan Rich. 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Money and Markets is a free daily investment newsletter from Martin D. Weiss and Weiss Research analysts offering the latest investing news and financial insights for the stock market, including tips and advice on investing in gold, energy and oil. Dr. Weiss is a leader in the fields of investing, interest rates, financial safety and economic forecasting. To view archives or subscribe, visit http://www.moneyandmarkets.com. From time to time, Money and Markets may have information from select third-party advertisers known as "external sponsorships." We cannot guarantee the accuracy of these ads. In addition, these ads do not necessarily express the viewpoints of Money and Markets or its editors. For more information, see our terms and conditions. View our Privacy Policy. Would you like to unsubscribe from our mailing list? To make sure you don't miss our urgent updates, add Weiss Research to your address book. Just follow these simple steps. © 2009 by Weiss Research, Inc. 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See also this post:

Dan Ferris: The No. 1 reason gold is above $1,000
Tuesday, September 08, 2009


By Dan Ferris in Extreme Value:

Something I haven't seen in the press much is that, the more fixing the government does, the worse the ultimate result will be.

The size of the bailout so far is absolutely unprecedented in all of history. Last November, ace researcher James Bianco did some math and found bailout spending at that time was equal to the inflation-adjusted cost of the Marshall Plan, Louisiana Purchase, Race to the Moon, S&L Crisis, Korean War, New Deal, Iraq invasion, Vietnam, and NASA – combined. Only World War II rivaled the bailout. And that was back in November.

All that spending originates as borrowing, and there's no way it'll ever be repaid. It'll be inflated away by the Federal Reserve's monopoly on money creation. That will erode the value of the money in your pocket, in your bank account, and, yes, in your stock portfolio, too.

That's why gold is pushing $1,000…

http://www.thedailycrux.com/content/2791/Dan_Ferris