Last week’s employment numbers allegedly demonstrated that all is well on the road to recovery. This has produced the type of frenzy which frequently initiates intermediate degree tops as this week is the 18th week of the present intermediate cycle. Normally, the intermediate cycle lasts 18-25 weeks from trough to trough. This was actually the time to stop and think about buying since the stock market is in one of these intermediate degree bottoms. But, now, it wouldn’t be so smart to buy because we’re so late in the intermediate cycle, mainly with the NASDAQ extended 9% above its 50 day moving average. According to some, it should be the time for investors to be taking in earnings…not selling short, but shifting to cash. Always keep in mind, though, the history of gold bullion.

The underlying logic here is that selling short isn’t that great because it’s structured to eliminate retail investors’ capital. It would be the very selected traders world-wide or large funds with enormous research departments that have the ability to search out and discover under par or deteriorating companies that will ever make any steady long-term winnings by selling short. Selling short requires the comprehension that markets descend incompatibly to their ascension. In this arena you are quite hindered in accomplishing, and fundamentally, maintaining any profits collected that selling short can offer.

To begin, tops are frequently a wearisome mechanism. They are inclined to pulverize short-sellers. These past four weeks have been a good example of that. Assuming you are one of the lucky ones who catch the top, the intraday moves are frequently so brutal that they knock one out of their positions. Lastly, if you don’t time the bottom well you will eventually be forced to return almost all of your scanty proceeds at some point in the first couple of days of the new rally. The best position for 99% of traders is to turn to cash when a correction is approaching as is the case now. We’re not saying that it will begin tomorrow or even this week, but it does signify that, at this moment, it is too risky to stay in the game with a market that has a sharp corrective move looming too close for comfort.

The trading environment has been altered with the dollar putting in its three year cycle low in May. Profits must be obtained faster as traders have had to become much shorter in duration. This trading condition isn’t going to be modified until the dollar’s major three year cycle tops. So far, there still is no evidence of a key reversal. The dollar is working hard at higher highs and higher lows. It has not even turned the 50 day moving average down yet and is still showing support above an increasing 200 day moving average.

At the point when the stock market begins moving down into its intermediate cycle low, it will surely compel an additional rally in the dollar, perhaps a return to new 52 week highs. Should this occur, it will drive gold to retest the December lows, and if the selling pressure from the stock market is powerful enough we could see another marginal new low somewhere in the high $1400s to low $1500 level. Notwithstanding the powerful rally out of the December 29 bottom, gold still has not broken the pattern of lower lows and lower highs. In actuality, gold is maintaining its downward inclination. When the stock market drops down into its intermediate bottom, gold’s down trend may be reconfirmed. So, it’s up to you what you do with your long and/or short investments, just be cautious and remember that gold bullion is the longest standing within modern (and ancient) history.

Investors who are able to interpret economic trends and understand the cost of gold bullion can position themselves for possible short-term gains, as well as long-term benefits. Generally speaking, the cost of gold bullion hovers a bit above the current gold spot price, which represents the cost of one troy-ounce of pure gold. Bullion is available in bar and/or coin form, with bullion coins carrying slightly higher prices than bars.

Household investors usually buy one-ounce and/or ten-ounce gold bars, and reputable brand names for bullion bar quality and 24-karat purity include Engelhard, Johnson Matthey, Credit Suisse, and PAMP Suisse. Bullion coins generally come in 22, and 24-karat purity (Austrian 100 Corona bullion is 21.6 karat coinage), and although both types of coins contain a full troy ounce of pure gold, 24-karat purity commands a higher cost of gold bullion.

The U.S. government backs the weight and precious metal content of 22-karat American Eagle bullion coins, which contain a full troy-ounce of pure gold. Investors worldwide choose American Eagles for their short-term gains, or as diversifications for long-term rare coins like Double Eagles, which command much higher prices. American Eagles are also the only acceptable 22-karat coins to be used for precious metal IRA storage, along with the aforementioned 24-karat, brand name bullion bars. 24-karat bullion coinage is also acceptable, and these coins include American Buffalos, Canadian Maple Leafs, Chinese Pandas, Austrian Philharmonics, and Australian Kangaroos, Koalas, and Lunar coins. Investors can avoid paying felonious retail prices for their American Eagle bullion, and Double Eagle rare coin by contacting one of our friendly specialists, who offer institutional discounts on these, and many other precious metals items to household investors like you.

Danny Burns

Investors, who purchase physical gold, usually initiate their investment with gold bullion, as gold bullion cost is significantly more affordable than rare coin. Bullion prices usually tend to hover slightly above the current gold spot price (which can be found on GoldPPrice.net), and unlike rare coin, bullion possesses no numismatic value, which is why investors prefer to initially protect their hard-earned wealth in bullion, until they thoroughly research their diversification options. For these reasons, bullion is also traditionally used for short-term potential profit ventures, with normal holding periods ranging between fourteen months or less. Bullion comes in the form of bars and coins, with bars commanding a slightly lower gold bullion cost than coins, due the greater simplicity of their manufacturing

BULLION BARS

Investors usually purchase one-ounce and/or ten-ounce bullion bars, because they’re easily and discretely carried or stored. 24-Karat gold bars are also acceptable to use in precious metal-backed IRA’s, allowing for long-term benefits, at a more affordable gold bullion cost. Reputable brand names for bullion bars include Johnson Matthey, PAMP Suisse, and Credit Suisse, for government-backed purity.

BULLION COINS

Bullion coins command a slightly higher premium than bars, due to the greater complexity of their minting. These items often become treasured keepsakes, and for some bullion coins, their limited minting makes them increasingly valued collector’s items over time. Another long-term benefit to bullion coins is that many of them are also acceptable as precious metal IRA contributions. They include the following coins:

22-Karat American Eagles, and 24-Karat American Buffalos, along with the following 24-Karat bullion coins: Canadian Maple Leafs, Australian Koalas, Kangaroos, and Lunar coins, Austrian Philharmonics, and Chinese Pandas.

Prospective investors are encouraged to complete their research, and then to contact one of our friendly specialists, who offer large-volume discounts on bullion bars and coins.

Danny Burns