This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Precious Metals Ready for Another Run

Gold futures pulled back in a steady decline, after reversing at $1,000 on Feb. 21, and gave up a good chunk of the post-October recovery rally. The contract broke six-week support at $900 on Wednesday and sold off to $882 about three hours before the latest Fed rate decision. That dip marked the low tick of the four-week correction.

The contract went vertical after the 2:15 p.m. announcement, as market players interpreted the latest Fed liquidity efforts as highly inflationary. In addition, the buying spike spread through the industrial commodities, including copper, steel and crude oil. Thursday and Friday brought little relief, with all groups heading into the weekend near their highs.

The reawakening of commodities in the middle of a worldwide slowdown could trigger a major episode of the law of unintended consequences. On the one hand, we might see raging bull market in the commodities and related equities that drove the raw-materials rally in early 2008. On the other hand, the rise in core prices could have a devastating effect on demand creation in the post-crash environment.

However, this turn of events should be great news for the trading community, because greed-driven buying pressure has been a missing element in the equity markets for many months. The reintroduction of steady uptrends into the mix of collapsing stocks should provide welcome relief and contribute mightily to 2009 profit production.

Gold Futures -- 120-Minute Chart

Precious metals are the place to start our hunt for profits, because gold is setting up for another test at $1,000. Note how the recent decline tagged the 38% retracement of the October to February rally and closed Friday at the 62% retracement of the monthlong correction. This is a natural spot for a consolidation and pullback to test last week's gains.
1 of 3

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
AZK $0.00 0.00%
AU $16.45 0.00%
BVN $10.15 0.00%
EGO $4.21 0.00%
GOLD $100.50 0.00%


Chart of I:DJI
DOW 17,773.64 -57.12 -0.32%
S&P 500 2,065.30 -10.51 -0.51%
NASDAQ 4,775.3580 -29.9330 -0.62%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs