(This is an excerpt from an article I originally published on Seeking Alpha on May 21, 2012. Click here to read the entire piece.)
Gold and silver have languished since reaching their last peaks in 2011. {snip} Last week, gold and silver reawakened and made sharp reversals. {snip}
Note that the dollar’s resurgence since hitting a bottom a year ago explains most of the weakness in gold and silver {snip} Neither gold nor silver will be completely out of the penalty box until they each break their respective near-term downtrends as shown above.
The stocks of miners of gold and silver have suffered even greater losses than the underlying precious metals. {snip}
Source for charts: FreeStockCharts.com
{snip} On Friday, Fleck wrote “Gold’s fortunes will soon reverse.” In that piece, he makes several provocative observations, including a quantification of the amazingly low valuation for PAAS {snip}:
{snip}
{snip} If you do not have any exposure to gold or silver, this is a great time to start with a sizable position and then plan to add in increments if the market serves up yet lower prices. If you already have a sizable position, then now is the time to nibble on some more of your favorite choices in precious metals. {snip}
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Be careful out there!
(This is an excerpt from an article I originally published on Seeking Alpha on May 21, 2012. Click here to read the entire piece.)
Full disclosure: long GLD, SLV, GG, and PAAS