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Sunday
Nov262006

GOLD: Inverse movement to the US$ or a breakout?

If we examine both the chart for gold and the US$ we can see that they are moving in opposite directions. Will the gold rally come to an end if the dollar snaps back?

A recovery by the dollar real or manipulated would put a slight dent in the progress of gold but would not put an end to gold’s rally, in our opinion.

Everyone and his dog knows that the dollar has a long way to go down before it will find its true value and like any pendulum it will probably swing right past its own equilibrium.

However it is worth taking a look at both of these charts and note the opposite behaviour of both the dollar and gold.

us$

gld


Our strategy is to continue to hold on to the investments that we have made and accumulate as and when the opportunity presents itself.


26 November 2006

Saturday
Nov182006

TASEKO MINES LTD: Disappoints

Along with copper, Taseko (TGB: AMEX) is just not performing so we think it prudent to vastly reduce our holding in this company.

The housing market in the US is falling off a cliff and the Chinese economy is said to be slowing. These two facts, real or imagined are effecting investor perception in a negative way.

We have looked at this situation long and hard and decided not to fight it, instead we have reduced our holding considerably. For the time being our exposure to TGB will be minimal.

Investment is all about performance and TGB just isn’t performing. When comparing its performance with other opportunities it is sadly lacking.

The money will go onto the sideline for the moment as we finalise our research in other areas. As soon as we are ready to jump back into the market we will publish what we are buying and why. For now just sit tight.

18 November 2006
Thursday
Nov162006

An opinion from a Chinese reader

The following is an extract from a reader who lives in China. His perspective from the inside of China is very interesting and well worth reading.

china1

From approved gold business in the year of 2001, China is just beginning for world marketing. But as being fond of gold and the trend of world economy development, China will be very important station in future market.

Recently our viewpoint for gold-price is following, price will break technology resistance of USD636 and keep it, so it will promote highly. From trend of short time, it’s possible that price rise to USD640-650 but we still need keep cautious attitude for this situation still meet much resistance from upper. The reason is,
Zhou xiaochuan, the president of bank of china, said that rate of development in economy will become a little slow that means Chinese inflation is still low accordingly. China will have the structural adjustment for foreign exchange reserve, which is more than one trillion, that means, reduce USD storage and increase another foreign currency to invest new market.

It wave instable for market of foreign exchange and for this time USD dollar still keep weakness, it’s possible to raise gold-price further. Marketing expert Mr. Dennis Gartman pointed in RBC Capital Market meeting that the gold-price still rise from the planning of central bank of many countries such as china, UAE and Saudi Arabia. Although this plan is promoted slowly, it continually is going on. Gartman estimated that china would increase a little foreign storage continually and slowly, so in the future of 15 years, the percent of Chinese storage will increase from 1% to 5%-6%. Gartman said that for USD dollar is still main storage currency in world and still has important condition in Chinese foreign storage, so Chinese government is impossible to reduce USD storage largely. But maybe china will gradually reduce USD capital and pay more attention to another currencies.

Currently global golden output per year is about two thousand five hundred tons and it totals about 506.4 trillion USD DOLLARS as USD 630 per ounce now, which is 5 percent of Chinese foreign storage. Now Chinese golden storage is about 600 tons by the government official, so if Chinese government buy more than 400-500 trillion USD dollar, it become 5-6 percent of world storage which will have 3000 tons demand in world market .For output per year in world is about 2500 tons, Chinese government will push price to top point.

Currently gold-price still located in high-risk perch relatively. As the investment to confront inflatable, its value to avoid risk is becoming weakness during the falling of CPI &PPI and inflation repeatability, which is the incessant admonition news from Unit state storage. From the point of view of technology, Market is still fluctuating.

To compare with same term in last year, before 9 months of this year, Chinese production gold is 169.281 tons, which augmented 12.615 tons and add 8.05%. From Jan to Sep, 2006, Chinese Smelt Corporation produce total production 81.744 tons, which add 19.31 percent than production during the corresponding period, last years.
The rate of Output per year in September in South Africa has dropped 5.1% to arrive 67.6 points.

The price of World base oil will become steady gradually under control of OPEC and it’s possible to rise a little continually .For the army of American will withdraw from Iraq gradually, so instability in condition of middle east will strengthen more.

Yours truly,

Danqing li

16 November 2006
Tuesday
Nov142006

The HUI: Coiled up and ready to rocket

The HUI is resting just above its own 200-Day Moving Average and in our view preparing for a much bigger move upwards than anyone expects.

hui1


We think that there will be some sideways movement over the next week or two as the market absorbs the election results and tries to figure out the effect of the Democratic parties success.

The Plunge Protection Team will try to keep a cap on gold prices in a managed way. It is not in their interests to have gold going to the moon, not just yet. However in our experience trying to manipulate the market is like buying trouble, sooner or later the tide will come in, we are only talking about when and how far it will go.

The Chinese are now sitting on a trillion bucks and have stated that they have a plan for diversification. Any percent of that amount of money going into gold will have a dramatic effect on the price of gold.

Hold and accumulate on dips that is strategy for now. Hang on in there gold is going to surprise us very soon.

14 November 2006
Tuesday
Nov142006

Glass Earth Limited: Update

glass2

Glass Earth Limited trades, as GEL on the TSX is a gold explorer in New Zealand. Despite recent good news the volume has all but dried up with only 73000 shares traded yesterday and some days have registered no trades.

This company has managed to raise another $10 million New Zealand and has a good story with some exciting prospects in New Zealand.

They have 15 advanced gold prospects in the Hauraki Region, which is the home of the world-class epithermal gold deposit at the Martha Hill gold mine.

They also have 17 recently defined gold targets in the Mamaku-Muirs Region, which includes the Muirs Reef prospect, where more than 43,000 ounces of gold have been mined.

Glass Earth has defined another 74 epithermal gold targets including 6 advanced drill-ready prospects.

This company offers a cheap entry into the New Zealand market, which from a geopolitical standpoint is a lot more accommodating than some other counties.
The question is when to invest? The answer is that we would like to invest now but the volume reflects such a lack of interest causing the stock price to slip. We first wrote about it when it was $0.20 it is now $0.13, a drop we predicted.

Again gold-prices will continue to watch this stock as it is an ‘outsider’ but comes with exciting prospects in an area historically rich in minerals.

14 November 2006
Monday
Nov132006

GOLD: Relax and enjoy the ride

Gold prices can move a long way upwards from their current levels so sit back and relax and enjoy what’s coming up.

gold13nov06

We can see from the chart that gold is in a healthy position right now, sitting just above its 200 DMA and set for a burst northwards just when we think she’s taking a nap.

Hold and accumulate is our strategy at the moment as we grow more and more confident every day that we are in for the ride of a lifetime.

13 November 2006
Thursday
Nov092006

GOLD: BUY, BUY, BUY

gold09nov06


If you are not already in then make an investment as soon as you can. Gold is on the move in a big way. You won’t see $600.0 again!

Are we getting to the point? Is anyone in any doubt?

Whether you prefer gold Exchange Traded Funds, gold itself or gold mining stocks, as we do, do it now!

We don’t care if you buy what we have bought or not, if you have your own favourite stocks buy them now.

It is going to be a golden Christmas; of this we are very confident. There are many chartists out there who are waiting for gold’s 50-day moving average to cross the 200-day moving average before they will buy. Well its coming to a trading screen near you and its coming quickly.

How far will it travel you ask? Here at gold-prices we think $710 by New Years Eve and then on to challenge the $800.0. It will be fast and furious. If you can’t stand the odd pull back then don’t look, just lie back and think of Honolulu.

And do not sell.


09 November 2006
Monday
Nov062006

KINROSS GOLD CORP to buy BEMA?

According to Reuters - Kinross Gold Corp. will make a takeover bid for fellow Canadian miner, Bema Gold Corp. trading halted on Monday morning.

This is a rather interesting move, which should be good for Bema’s stock price. We will need to see the details of the bid before we can comment further.

Kinross Gold Corp trades on TSX as K and on the NYSE as KGC.

Bema Gold Corporation trades as BGO.

06 November 2006
Sunday
Nov052006

Democrats poised for US election gains

us2


Well that’s what is being reported in the International Herald Tribune. They also add that these elections will cost about $2.6 billion, money mainly spent on TV advertising campaigns.

Worth a quick read: The International Herald Triune: Americas

05 November 2006
Sunday
Nov052006

SILVERADO: Adds another 11% on Friday

silv1


On the 30th October 2006 we reported that we might just be in for a pleasant surprise! Wow! This gold mining stock has rocketed up the chart.

We wrote about Silverado getting closer to the Mother Lode on the Nolan Heights just a week ago and then a buying frenzy started. We have to say that we were not amongst the buyers as we are already in position on this one. So we had no effect on the price but others have certainly pilled in.

silv2

Is the buying spree over? We do not think so. Why?

Well the Market Capitalisation for this company is around $49.0 million.

Silverado have invested more than $40.0 million into the Nolan Heights project.

The have a round $1.0 million or so in gold

All of the drainage channels that they have explored have contained gold.

This is a famous gold mining area.

The scientific indications are that they could be close to a major discovery.

(They also have the green fuel side of the business, which if the Democrats get in could see alternative forms of fuel in a brighter light.)

There are many companies out there with not much more than a nice address in Vancouver and a few ideas. Some of these companies are selling at large premiums when compared to their assets. Where as Silverado has something going for it and that’s why we are investors.


On the downside they may never find anything, but that applies to a lot of gold mining ventures. The average volume for the last 10 days is 3.3 million shares traded, on Friday 7.1 million shares changed hands. So the stock price could come back when the volume drops, we will wait and see.

Go gently as always, but at 8 cents a share it is still a bargain in our very humble opinion.


05 November 2006