Friday, May 27, 2011

05.27.2011



HOURLY SHORT (End of Day Report)


The market is showing some nice breakout signs and ready for another test of the significant $39.00 area which has several fibonacci blocks and the fifty day moving average. Boy would this create a big failed move if the fifty is not much resistance and maybe this will be the top for the next wave lower with higher volume coming. That is tough to say and as long as we are between $32 and $39 (over 20% range) then the market will be in the boring mode and the fast moves coming soon. The currency is dying and the advantage to the USA dollar index losing is it least creates the awareness to the people that the dollar is losing strength. It tracks fiat debt notes over other fiat debt notes over other fiat debt notes, but the story-lines that occur on the propaganda press would be enough to signal inflationary worries and concerns. The video below explains more to why the currency is dying. (at the least the USA one versus others)




GOLD ANALYSIS


The trend lines shown in this chart are parallel and have the same distance on each higher level. The gold market is looking to head towards level four bull market as it is breaking through the current resistance field that was first resistance in 2008 when it reached a thousand per ounce. No reason at all to think that this market is going to slow down and if anything the reason is for this market to keep going higher as the currency keeps being devalued with fiat money. Long term I am a little concerned with gold's future because of golds tangible uses in what I predict to be the end of a materialistic world, but at the same point it would expected that this unique metal would be needed in some sort of new industrial use and if it is needed in large quantities the scarcity issue will become a problem. Short term however this is a great hedge against fiat paper inflation.

SILVER TO GOLD RATIO


This chart is the polar opposite of the gold to silver ratio and thus the silver to gold ratio and how many mg of Gold is needed to buy an ounce of silver. This chart exploded large and has now corrected very large. It is at 700 or at an area where twice resistance was previously met. The historic ratio is around 16 to 1 and that would work out to 2,000 on this chart and we are a long way from being at that level. My personal belief and calculated research is that the ratio is going to not only go back to its historic sixteen to one mark but even go lower thus this chart should remain bullish and maybe go over three or four thousand. The intrinsic value for gold is very weak in comparison to silver and the silver market seems to be more suppressed than the gold market is. During these end times when we are going through the stages of the end of the currency these charts should remain volatile as panic sets in the currency market.

SILVER more VOLATILE than GOLD


This chart is showing only a potential breakout of silver containing more volatility and with the currency dying right now it most likely will keep going higher. In the late 70s the Silver market went from around $6 to $50 while gold went from $400 to $800 showing much larger gains. Lets assume gold reaches $4,500 and thus gains 200% then the most likely scenario is silver gaining over 1000% and having more wild movement. If silver makes these kinds of gains that would mean over $300 per ounce and moves like this in a quick period of time need to have something unusual for this to be the case, but its not every year a currency dies.



No more silver commentary on the blog and I'll try and get one video out (probably on Sunday) but there is not much to go over now and will focus on the gold charts I promised later tonight as well as any odds and ends that I can think of. If you have any suggestions or requests then please mail me with a comment here, on youtube or @endlessmountain on twitter

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