Catch Your Breath
International
Investors have moved back into the US treasury market as they sought shelter from the global slowdown. Data out of Europe shows the economy is slowing, and Chancellor Merkel seems to be losing patience with her fellow leaders as Spain continues to drag its feet regarding the need for a rescue. Greece still hasn’t been able to show it has met requirements for another round of bailout funds, and Der Spiegel suggests the Greek deficits are much larger than being reported.
Concerns over tensions between Israel and Iran also contributed to the move by global investors back into the US$. And finally, data out of China has caused a resurgence of the ‘hard landing’ predictions for the Chinese slowing economy.
Metals
Friday saw profit taking in both gold and silver with gold failing to trade above $1,792.70, which would have been a new high for the year. Silver was unable to find support above $35.00. Both sold off late in the day – probably leading to more selling in the immediate future. Early this morning in Asia, one party sold 2,500 silver contacts forcing the market below $34.00.
All Things Considered – John’s Commentary:
While the trend is clearly for higher prices through the end of 2012 and well into 2013, profit taking is the order of the day.
Action to take: The primary trend is up. Don’t try to outsmart the uptrend thinking you can time the market. Wall Street with billions of dollars in computing power can’t even do that. Simply buy. In a year from now, you will be more thankful that you have the metals than those who tried to squeeze an extra dollar and never bought.
Quote of the day: “Whom the gods would destroy, they first subsidize.” – George Roche
