Greetings Jim,
Gold closed moderately higher today, moving up to a new short-term high for the developing reaction from late January. Technical indicators are now moderately bullish overall on the daily chart, supporting a continuation of the advance.
Technical indicators are strengthening on the Gold Currency Index (GCI) daily chart as well, indicating that the short-term uptrend will likely continue.
From a temporal perspective, today’s strong move higher has confirmed that the current short-term cycle from January 27 is right translated, forecasting additional gains and a likely return to previous all-time highs.
The current short-term cycle has developed almost exactly as anticipated since the initial cycle low signal setup was generated in late January. Now that we have a confirmed Short-Term Cycle Low (STCL) followed by a right translated cycle, the Intermediate-Term Cycle Low (ITCL) that we have been expecting is one strong weekly close away from forming.
Both price oscillators have experienced bullish crossovers and a bullish engulf pattern has formed on the weekly chart. Therefore, if gold closes on Friday at current levels or higher, a confirmed intermediate-term cycle low signal will be generated, forecasting 2 to 3 months of gains and a likely breakout to new all-time highs.
Best,
CIGA Erik McCurdy
Prometheus Market Insight
http://www.prometheusmi.com
‘Toxic’ Assets Still Lurking at Banks
CIGA Eric
Accounting tricks may hidden the problem from plain view, but out of sight, out of mind approach hides the problem behind layers of complexity. Trillions of dollars of toxic assets still exist and have no market. This largely explains why the Fed refuses to throttled back on it’s liquidity programs despite the illusion of an economic recovery.
During the financial crisis, investors fretted over "toxic," hard-to-value assets that banks were carrying. Those fears have faded as bank profits have rebounded, loan delinquencies have declined, and bank stocks have soared 25% in the past five months.
But banks still hold plenty of the bad assets that once spooked investors: mortgage-backed securities, collateralized debt obligations and other risky instruments. Their potential impact concerns some accounting and banking observers.
Source: online.wsj.com
Dear Jim,
Note the mention of the Chinese bank offering a gold buying plan that has 1 million investors signed up to purchase $42 dollars of gold per day!
CIGA Marc in the Trenches
