Verticle TV & Music

Several Factors Suggest That The Bottom in Gold and Silver Is Near

This essay is based on the Premium Update posted on June 14th, 2009

In my previous essay (and in my previous Premium Update, which you will be able read, as it is now posted on my website as a sample version) I wrote the following:

(...) once you consider details, the outlook becomes rather bearish in the short term. The point here is that volume has been declining while gold has been rising and it rose along with declining gold price. Volume usually confirms the direction in which the market is headed, and this time it points to lower prices in coming days. Naturally, a day or two of pause are possible (and also quite likely), as gold is currently just at its support level, but still - it is likely that gold will move lower in the short term.

This is exactly what took place during the rest of the week - we had slightly higher prices of gold, silver and mining stocks in the middle of the week, but they closed lower on Friday. Of course the key question here are: "Is the bottom already in?" and "Is it safe to get back on the long side of the market?" In short, it seems that we are going a little lower before we will reach a local bottom.

Gold

Moving on to the current situation, let's begin with a gold chart. Charts are courtesy of stockcharts.com.

At the first glance, the situation on the gold market looks quite bullish. Gold has advanced substantially from April to June, and has been correcting since the beginning of this month. Corrections are to be expected on any market, and gold is no exception here, so until we see evidence that this correction is anything more than just that, we remain bullish in the long run. Right now the price of gold (and also the value of the GLD ETF) has closed at its long term support level (solid blue line), which generally indicates that a rebound is likely.

Generally doesn't mean always, and it is usually useful (and profitable) to put "general rules" into proper context before making any investment decisions. As mentioned above, the price of gold stopped at the rising support line. However, did gold rebound in the past when the situation was similar? I have marked two situations with dashed lines on the above chart.

Please note that each time price got to the analogical support line it has briefly broken it before rising again, so this may be the case also now.

Additionally, previous bottoms were accompanied by particular signals from the stochastic indicator (as seen on the bottom of the gold chart). Several weeks ago I wrote about the RSI indicator as particularly useful in timing top on the precious metals market. Naturally - there is no perfect tool. RSI is not that useful in determining bottoms on the PM market, as it is the case with tops. Still, there are many more indicators than just the Relative Strength Index, and one of them proved to be particularly useful in estimating bottoms in the recent past. During the past several days most meaningful bottoms took place when stochastic indicator was below the 20 level and it started to rise (thus crossing its moving average) - I have marked these situations with red ellipses.

Currently, the stochastic indicator has moved lower, but it is not yet below the 20 level. Therefore, there is another significant confirmation of the previous conclusion - the bottom is near, but it is yet to materialize. How low can it go temporarily? We will leave this part of our analysis to the Members of our Premium Service.

Silver

The first thing that comes into mind after taking a glimpse at the above chart is that silver has held very well during the current decline. The strength in the silver market should not surprise you, if you've been following my analysis for some time now - I've written about the particularly favorable situation on the silver market on 20th of April.

As far as the target for this decline is concerned, the situation is similar to the one in the gold market. The area in which the bottom is likely to take place is marked with a red ellipse and it contains levels corresponding to two important Fibonacci retracement levels: 38.2% and 50%. Prices of many assets often correct these parts of their previous move before resuming their main trend (for example the 38.2% level stopped the decline at the beginning of March 2009). Another important level that this ellipse contains is the lower border of the short term trend channel - if we get the C decline of the ABC (zigzag) correction it may go exactly to this support level. I currently view such a decline as likely.

Summary

After having rallied in May, the whole precious metals sector entered a corrective phase, which began two weeks ago. Currently many factors suggest that the end of this correction is near. The coming bottom is likely to provide a favorable buying opportunity for long-term investors with the "buy more on the dips" approach. Short-term traders are advised to consider preparing themselves for opening long positions and closing remaining short ones in the coming days.

To make sure that you get immediate access to my thoughts on the market, including information not available publicly, I urge you to sign up for my free e-mail list. Sign up today and you'll also get free, 7-day access to the Premium Sections on my website, including valuable tools and charts dedicated to serious PM Investors and Speculators. It's free and you may unsubscribe at any time.

P. Radomski
Editor
SunshineProfits.com

Interested in increasing your profits in the PM sector? Want to know which stocks to buy? Would you like to improve your risk/reward ratio?

Sunshine Profits provides professional support for precious metals Investors and Traders.

Apart from weekly Premium Updates and quick Market Alerts, members of the Sunshine Profits’ Premium Service gain access to Charts, Tools and Key Principles sections. Click the following link to find out how many benefits this means to you. Naturally, you may browse the sample version and easily sing-up for a free trial to see if the Premium Service meets your expectations.

All essays, research and information found above represent analyses and opinions of Mr. Radomski and Sunshine Profits' associates only. As such, it may prove wrong and be a subject to change without notice. Opinions and analyses were based on data available to authors of respective essays at the time of writing. Although the information provided above is based on careful research and sources that are believed to be accurate, Mr. Radomski and his associates do not guarantee the accuracy or thoroughness of the data or information reported. The opinions published above belong to Mr. Radomski or respective associates and are neither an offer nor a recommendation to purchase or sell securities. Mr. Radomski is not a Registered Securities Advisor. Mr. Radomski does not recommend services, products, business or investment in any company mentioned in any of his essays or reports. Materials published above have been prepared for your private use and their sole purpose is to educate readers about various investments.

By reading Mr. Radomski's essays or reports you fully agree that he will not be held responsible or liable for any decisions you make regarding any information provided in these essays or reports. Investing, trading and speculation in any financial markets may involve high risk of loss. We strongly advise that you consult a certified investment advisor and we encourage you to do your own research before making any investment decision. Mr. Radomski, Sunshine Profits' employees and affiliates as well as members of their families may have a short or long position in any securities, including those mentioned in any of the reports or essays, and may make additional purchases and/or sales of those securities without notice.

About the Author

Przemyslaw Radomski is the founder, owner and the main editor of www.SunshineProfits.com. Being passionately curious about the market’s behavior he uses his statistical and financial background to question the common views and profit on the misconceptions. “Don’t fight the emotionality on the market – take advantage of it!” is one of his favorite mottos. His time is divided mainly to analyzing various markets with emphasis on the precious metals, managing his own portfolio, writing commentaries, essays and developing financial software. Most of the time he’s got left is spent on reading everything he can about the markets, psychology, philosophy and statistics.

Mr. Radomski has started investigating the markets for his private use well before starting his professional career. He used to work as an informatics consultant, but this time-consuming profession left him little time for his true passion – the interdisciplinary market analysis. Establishing www.SunshineProfits.com gave him the opportunity to put his thoughts, ideas, and experience into form available to other investors.

Jordan & Júlio no gold premium

US Auctions Australian Auctions Austrian Auctions Belgian Auctions Canadian Auctions French Auctions German Auctions Irish Auctions Italian Auctions Dutch Auctions Spanish Auctions Swiss Auctions GB Auctions

Best Match Items Ending First Newly-Listed Items First Price + Shipping: Lowest First Price + Shipping: Highest First

10 ft 10FT 3m Premium Quality 13 Gold HDMI Cable for 1080p PS3 HDTV TV Xbox $4.23 Time Remaining: 24d 8h 34m Buy It Now for only: $4.23 Buy It Now

1 Gr G Gram 9999 24K GOLD Premium Bullion Bar Ingot $56.00 (14 Bids) Time Remaining: 2h 20m

1 Gr G Gram 9999 24K GOLD Premium Bullion Bar Ingot $57.66 (6 Bids) Time Remaining: 8h 21m

4 PK 6ft HDMI Cable Premium 13 Gold 1080P For XBOX 360 US $8.99 Time Remaining: 11d 17h 52m Buy It Now for only: $8.99 Buy It Now

1 Gr G Gram 9999 24K GOLD Premium Bullion Bar Ingot $57.66 (6 Bids) Time Remaining: 9h 21m

75 FEET PREMIUM HDMI 24AWG CABLE High Speed + LCD HD 75FT GOLD PS3 HDTV 1080P $43.95 Time Remaining: 24d 12h 3m Buy It Now for only: $43.95 Buy It Now

1 Gr G Gram 9999 24K GOLD Premium Bullion Bar Ingot $45.00 (5 Bids) Time Remaining: 11h 20m

1 Gr G Gram 9999 24K GOLD Premium Bullion Bar Ingot $53.50 (6 Bids) Time Remaining: 10h 20m

Premium 25FT 15M HDMI 14 Gold Cable For PS3 HDTV 1080p $9.50 Time Remaining: 3d 9h 49m Buy It Now for only: $9.50 Buy It Now

1 Gr G Gram 9999 24K GOLD Premium Bullion Bar Ingot $45.00 (4 Bids) Time Remaining: 12h 21m

Premium 6FT 24K Gold HDMI Cable 1080p 13b for HDTV New $2.69 Time Remaining: 8d 22h 34m Buy It Now for only: $2.69 Buy It Now

1 Gr G Gram 9999 24K GOLD Premium Bullion Bar Ingot $53.38 (4 Bids) Time Remaining: 13h 21m

1 Gr G Gram 9999 24K GOLD Premium Bullion Bar Ingot $56.00 (5 Bids) Time Remaining: 7h 20m

75 FEET PREMIUM HDMI 14 24AWG CABLE High Speed + Ethernet + 3D LCD HD 75FT GOLD $54.95 Time Remaining: 27d 21h 46m Buy It Now for only: $54.95 Buy It Now

1 Gr G Gram 9999 24K GOLD Premium Bullion Bar Ingot $53.56 (4 Bids) Time Remaining: 14h 20m

12 HDMI to HDMI M M v 14 Cable 12ft HDTV 1080p Premium Gold 12 ft $6.84 Time Remaining: 21d 6h 22m Buy It Now for only: $6.84 Buy It Now

1 Gr G Gram 9999 24K GOLD Premium Bullion Bar Ingot $53.56 (6 Bids) Time Remaining: 16h 20m

Gold Seal Premium Tailors Chalk 5 Pieces in a Variety of Color Combinations $2.95 Time Remaining: 19d 10h 3m Buy It Now for only: $2.95 Buy It Now

1 Gr G Gram 9999 24K GOLD Premium Bullion Bar Ingot $11.49 (3 Bids) Time Remaining: 15h 20m

1 Gr G Gram 9999 24K GOLD Premium Bullion Bar Ingot $0.99 (2 Bids) Time Remaining: 17h 20m

100 pc Lot GOLD Premium Foot Pad Patch Detox Patches US $27.99 Time Remaining: 1d 13h 45m Buy It Now for only: $27.99 Buy It Now

1 Gr G Gram 9999 24K GOLD Premium Bullion Bar Ingot $57.60 (10 Bids) Time Remaining: 4h 47m

2 Pack 6FT Gold Plated Premium High Speed 14 Ver HDMI Cable with ethernet 1080p $5.99 Time Remaining: 29d 8h 49m Buy It Now for only: $5.99 Buy It Now

5 Gr G Gram 9999 24K GOLD Premium Bullion Bar Ingot $207.50 (5 Bids) Time Remaining: 1d 19h 50m

25 Gr G Gram 9999 24K GOLD Premium Bullion Bar Ingot $132.50 (8 Bids) Time Remaining: 19h 40m

Evercoat 112 Rage Gold Lightweight Premium Body Filler Gallon $42.00 Time Remaining: 23d 13h 47m Buy It Now for only: $42.00 Buy It Now

2003 AMERICAN EAGLE SILVER NGC MS69 PREMIUM QUALITY BROWN GOLD LABEL NO RESERVE $28.00 (6 Bids) Time Remaining: 7h 58m

AccuFitness FatTrack GOLD Premium Digital Body Fat Caliper Package Accu Fitness $34.95 Time Remaining: 20d 10h 10m Buy It Now for only: $34.95 Buy It Now

Early Waterman France Gold Lined Fountain Pen Set Solid 18K Gold NIb Premium Box $10.50 (4 Bids) Time Remaining: 1d 14h 27m

1 Gr G Gram 9999 24K GOLD Premium Bullion Bar Ingot $56.00 (5 Bids) Time Remaining: 6h 20m

Premium Gold Plated Hdmi Extension Cable Extender Male to Female 3 ft 3ft 3 $4.20 Time Remaining: 28d 8h 34m Buy It Now for only: $4.20 Buy It Now

25 Gr G Gram 9999 24K GOLD Premium Bullion Bar Ingot $138.50 (8 Bids) Time Remaining: 17h 40m

25 FEET 25FT HDMI HIGH SPEED PREMIUM CABLE LCD HDTV Blu ray PS3 1080P 13B GOLD $9.99 Time Remaining: 9d 22h 8m Buy It Now for only: $9.99 Buy It Now

Lot of 2 Xen Tan Scent Secure Gold Premium Sunless Tan Self Tinted Moisturizer $3.25 (4 Bids) Time Remaining: 37m

Premium 100ft M M SVGA Cable Gold VGA HD15 100 Foot $15.99 Time Remaining: 13d 19h 50m Buy It Now for only: $15.99 Buy It Now

25 Gr G Gram 9999 24K GOLD Premium Bullion Bar Ingot $56.55 (3 Bids) Time Remaining: 18h 40m

Elishacoy Premium Gold Mineral BB SPF45 PA+++ 50ml Free gifts $25.80 Time Remaining: 1h 8m

New Premium 13a Gold 6 FT HDMI Cable for 1080p PS3 HDTV Support HD monster $5.00 Time Remaining: 20d 9h 26m Buy It Now for only: $5.00 Buy It Now

25 Gr G Gram 9999 24K GOLD Premium Bullion Bar Ingot $127.50 (2 Bids) Time Remaining: 1d 18h 40m

50 Feet Hdmi PREMIUM CABLE LCD HDTV Blu ray PS3 50FT 15M 1080P GOLD 24AWG $28.95 Time Remaining: 3d 6h 20m Buy It Now for only: $28.95 Buy It Now

2 x Premium 6 FT Gold HDMI Cable 1080p M M for New HDTV $5.99 Time Remaining: 1h 6m Buy It Now for only: $6.59 Buy It Now

Honda Gold Wing 2008 Honda Gold Wing GL1800 titanium premium audio $12,900.00 Time Remaining: 1d 12h 2m

5 FT 6 FT Premium Gold HDMI Male AV Video Cable Adapter HD BluRay for PS3 TV $1.50 Time Remaining: 16d 23h 53m Buy It Now for only: $1.50 Buy It Now

5 Gr G Gram 9999 24K GOLD Premium Bullion Bar Ingot $280.00 (9 Bids) Time Remaining: 19h 50m

High Speed Black 6ft 6 Feet Premium Gold 13 HDMI Cable Cord for HDTV 1080p $2.99 Time Remaining: 8d 21h 43m Buy It Now for only: $2.99 Buy It Now

vtg black Adams Fedora with box size 7 1 4 inner band gold stamped Adams premium $9.99 Time Remaining: 4d 18h 14m

ENZYMEDICA DIGEST GOLD PREMIUM ENZYME FORMULA 240 CAPSULES $36.03 (7 Bids) Time Remaining: 3d 4h 53m

New Premium 13b Gold 6 FT HDMI Cable for 1080p PS3 HDTV Support HD 6ft cable US $2.69 Time Remaining: 14d 22h 35m Buy It Now for only: $2.69 Buy It Now

OrGano Gold Premium Royal Brewed Jamaican Blue Mountain $5.00 Time Remaining: 2d 11h 11m Buy It Now for only: $5.50 Buy It Now

Lowest TOP Premium 1080p Gold HDMI 13 Cable 6 FT for HDTV Blue Ray Dvd HD Video $1.44 Time Remaining: 1d 15h 56m Buy It Now for only: $1.44 Buy It Now

Premium Stock PS The Gold Standard Baltimore Pilsner Beer Glass 9 Tall $4.99 Time Remaining: 5h 43m

PTC Premium Gold Series High Speed HDMI Cable, 6 feet (3-Pack) Sale Price: $18.75   Eligible for free shipping! Availability: Usually ships in 24 hours See Reviews For This Product Description High speed HDMI with Ethernet is the newest HDMI® Standard published recently by the HDMI® org. - HDMI® Ethernet Channel: Adds high speed networking to an HDMI link, allowing users to take full advantage of their IP enable device without a separate Ethernet cable...

Mr. Beer Premium Gold Edition Home Brew Kit List Price: $59.99 Sale Price: $54.44 You save: $5.55 (9%)   Eligible for free shipping! Availability: Usually ships in 24 hours See Reviews For This Product Description Everything required to brew 2 batches (4 gallons) of beer at home. Includes: brew keg, 2 standard refill brew packs (Classic American and Cowboy Lager), 8 re-usable 1-liter bottles w/caps and labels, Brewing w/Mr...

Premium Adjustable Necklace Extender - Gold (1-3") List Price: $15.00 Sale Price: $9.99 You save: $5.01 (33%)   Eligible for free shipping! Availability: Usually ships in 1-2 business days See Reviews For This Product Description * Our customers requested a new version of our best selling adjustable necklace extenders, and we were happy to oblige! * Using these necklace extenders is easy - just clasp each end of the necklace extension to each end of your chain, and slide to adjust the piece to your desired length...

Premium Mirrored Aviator Sunglasses - Gold(3Pack) Special Sale Price: $7.37   Eligible for free shipping! Availability: Usually ships in 1-2 business days See Reviews For This Product

PREMIUM GOLD PLATE 6 FT HDMI CABLE FOR HDTV/DVD 6' M/M Sale Price: $9.99   Eligible for free shipping! Availability: Usually ships in 1-2 business days See Reviews For This Product

United States Army USA Seal Gold Plated Premium Metal Car Truck Motorcycle Emblem Sale Price: $17.95   Eligible for free shipping! Availability: Usually ships in 24 hours See Reviews For This Product Description United States Army, USA, Official Seal, gold-plated, auto car truck 3 1/2" diameter metal emblem. Base and frame crafted of gold-plated metal. Decal within frame is laminated with 1/8" thick PVC. Guaranteed to withstand any outdoor conditions and not fade or bleed...

Premium Gold Collection List Price: $13.98 Sale Price: $9.85 See Reviews For This Product

Krylon 1000 Premium Metallic Spray Paint, Gold Sale Price: $9.36   Eligible for free shipping! Availability: Usually ships in 24 hours See Reviews For This Product Description Crafter's metallic spray is safe for most surfaces, even styrofoam or plastic.

Tachikara SV5W Gold Competition Premium Leather Volleyball (White) List Price: $59.99 Sale Price: $48.49 You save: $11.50 (19%)   Eligible for free shipping! Availability: Usually ships in 24 hours See Reviews For This Product Description The very best is now even better! Our flagship model volleyball has been upgraded to feature Dual Bladder Construction (DBC), Tachikara's latest innovation in patented manufacturing methods and technologies...

Pacific Gold Original Beef Jerky Natural Style Premium Jerky Two 8 Ounce Resealable Bags List Price: $39.99 Sale Price: $22.97 You save: $17.02 (43%)   Eligible for free shipping! Availability: Usually ships in 24 hours See Reviews For This Product Description Pacific Gold Brand Beef Jerky Made from Solid Strips of Beef. 97% Fat Free! Pacific Gold Natural Style Beef Jerky is made from the finest U.S.D.A. approved beef, blended with the highest quality seasonings available...