(Apr. 16th, 2011)
- great action in Silver, more coverage
- technically plowed thru $42
- gold very strong, took out good resistance at $1480
- WRT miners, looked like ratio trades unwinding, long bullion, short miners, but ratio trades coming back in.
- ratio chart of HUI to price of silver, HUI to silver ratio is same as 2001 when silver at $4/oz. Peak was above 45, now 13.5.
- XAU is worse, peak in late 2003 above 20:1, now at 5:1, can’t find when the ratio was this low going back 20 years.
- mining shares are obscenely undervalued.
- is watching the HUI at 575 since that is the area where ratio trades started to be unwound in the past few weeks.
- COT report, picked up Goldman ‘lets sell commodities’ call, shows liquidation of managed money, gold saw big commercials pile on shorts.
- US dollar, relentless downtrend.
- only reason for dollar uptick is due to Ireland downgrade.
- not impressed with US dollar, would need to get above 76.50 to break trend.
- on crude oil, strong energies but gold and silver moving up on inflation play due to energy increases. Europe and China have inflation concerns, yet US CPI core was 0.1%, bonds moved up on this bogus tame inflation call
- silver, floor at $42, should move higher to $44 test early next week. If $42 fails, then could fall to $40.25 and still be ok. Seems to move up in $2 increments
- gold, could make a run at $1500 next week, likely will see resistances, if it does go thru $1500 easily then could run.
See full interview on Kingworldnews here (about 7 min. in)