>>>>>>>>>> Monday, December 29, 2003, 9:04:00 PM EST
Gold and Gold Shares On Launch Pad?
Author: Jim Sinclair
As the tax man takes leave and the bonus programs for gold fund managers expire, the tired gold shares are coming to life again which could portend a ballistic move upward in the gold price.
Barron’s may have published its bullish (yes I did say bullish) gold share article predicting $80 for Newmont a hair too early as the fund managers who sold to lock in their bonuses may have to buy those shares back or look for another job.
I am still waiting for Barron’s new valuation of Royal Gold using the Franco Nevada model which would yield a value that’s $50 higher than its previous article. What other model could it use - there’s only one out there.
The gold share investors have suffered significantly because of the penmanship of those advisors who even today published reports saying that a reaction in gold was confirmed. Where and what gold market are they talking about?
These fellows are like the scientists predicting what the weather will be like 100 years from now when they can’t even get it right a week ahead. However, you’ll be certain to hear all those “I told you so” statements by these self-styled experts when gold drops from $490 to $482 or some similar situation transpires.
At the present time, we sell 1/3 of our positions when our investment goes ballistic (the classic “Rhino Horn” formation) on the upside, buying back when the shares do their “Fishing Line with Sinker” trick. You had both of these scenarios in the gold shares in the past month while bullion just kept plugging along higher day after day. It is now time to watch for the classic “Rhino Horn” formation again. If you missed that, then Power Up Trend Line breakdowns make a sale necessary. A break of the Power Down Up Trend Line as occurred today in many shares makes a buy necessary. This is dirt simple discipline but oh so profitable.
There is nothing different today from yesterday or the day before in any of the good gold companies from producers to juniors. But the charts sure look different. Let’s use discipline and not get crazy on the bull side as these situations bolt upwards. In case you’ve forgotten, I also counseled you to not get bearish when many of these situations were pummeled recently.
We are all pros here so buy the reactions TA correct and sell the ballistic up moves in ANYTHING gold using your collection of French Curves. Never chase the gold price higher to buy or lower to sell or you get a piece of coal next Christmas in your stocking. The only time you can “reach” is after a break of the Power Trend Line and even then you should not because internals will forecast such breaks ahead of time.
Get smart and get richer. You can do it because you have learned discipline and are deserving of Comet status.
Some of my colleagues think it’s nuts to pay people to do their homework but that is the purpose of the contests I run. This week there will be another five contest winners of gold coins. The Golden Comets I’ve been mailing out time permitting were not designed and custom manufactured for free. Even so, it makes me happy to see people take the private oath to themselves only to “Trade Smart” and stop being turkeys for the pros to pick off on a regular basis.
With the majority of gold advisors, you pay them substantial money and get nothing much in return. I don’t need to pick your pocket to make money when a market sits there like a ripe melon just waiting to be picked clean. Prosperity is like air, it is everywhere and all you need to do is inhale. Need is like darkness: all you need to do is stop cursing it and turn on a light. I do this for the love of it.
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