Monday, August 22, 2011

Strength abroad

7:31 pm (Hawaii) At some point, what is hot becomes cold and what is cold becomes hot. Or maybe not. Gold is holding strong above 1900 in Asian trading. Doesn't seem to be a margin hike on the horizon, regardless of whether the CME mafia claims there is "volatility" and "speculation" in the gold (or silver) market.

My gut feeling is that passing 1900 is not a hurdle, but any attempt to get over 2000 will be met with severe headwinds. Just one of those things. Heck 1900 may not even hold by morning, who knows? But that's my gut feeling.

As for silver, the complexities are there. If and when Helicopter Ben alludes to any type of QE on Friday, does silver benefit? The miners would seem to like that, being bullish when equities rise and falling apart when the market crashes. Brian Kelly said on CNBC that if Bernanke doesn't allude to QE3 at all, gold could fall $200 easily. That may have been true a month ago, but now, I don't think so. Europe and Asia, retail and central banks, are buying with both fists. Just look at the charts for the past few weeks. Asia keeps buying and buying regardless of what goes on in the US.

For Kelly to say Bernanke would possibly not talk about QE3 is another way of providing another branch of discussion on the air, but since when has the Fed chief not wanted to print paper? Whether he brings it up or not, the US is still more than $14 trillion in debt and printing more fiat by the day. There is still no sincere attempt at austerity by Capitol Hill. So at worst, PMs may dip 3-5% in this circumstance, and possible just be flat for the day. But eventually, it will rise higher whether TV chatterbrains like it or not. Yeah, that includes Gartman the Fickle.

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