Replies to post #833 on Justa's Dive Bar

[Ace Hanlon]

I view any further market advance here as kind of a final blowoff.

Re: gold interesting to compare it with the Dow.

At the $720 peak last May the Dow sold at about 15 times the gold price.

Today with gold at $685 the Dow is about 19 times the gold price.

I expect the Dow/ gold ratio to drop to at least the 15 level previously hit and probably lower before the next intermediate peak. Assuming the Dow hits 13000 this means a gold price of $800 plus.

A year ot two hence I look for a Dow/gold ratio of 10 or less.

Just like any other asset gold will climb at an accelerated pace once blowoff action begins.

[Ace Hanlon]

Gold and HUI very strong on the surface BUT

WHY HAS THE SPREAD BETWEEN GLD AND GOLD BULLION WIDENED TO AROUND 10 BUCKS?

THE SPREAD USUALLY IS 4-5 BUCKS.

Something not kosher here IMHO.

[chainik]

Sold a little bit of HUI.

IMO the trend is still up, but there are a few warning signs

1. USD might be close to a bounce;
2. RSI(14) > 70 on HUI has served as a decent "sell" in the past http://stockcharts.com/h-sc/ui?s=$HUI&p=D&yr=1&mn=0&dy=0&id=p73142970252
3. Big moves in a lot of gold junk (10-20%) today. Usually when this happens the upside in bigger miners is small.

Will sell a bit more at HUI around 385-390.

Sold EMC and EWS (>10% gains) to raise cash. Probably should have kept EMC (I expect strong report tomorrow), but I don't want to take too much risk.