From: Jim Sinclair's MineSet [EMAIL PROTECTED]
To: Robert Paul LeBreton [EMAIL PROTECTED] Password
Sent: Monday, February 10, 2003 4:11 PM
Subject: The Internet Gold Sites Pounce on Gold
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Re: Monday, February 10, 2003
The Internet Gold Sites Pounce on Gold
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You talk about shooting yourself in the foot! These guys just shot
themselves and all gold investors in the foot with a Heat Round from a
recoilless Field Cannon.
The huge selling that stone-walled gold at the top of the recent rally when
gold hit $390 was a combination of:
1/ More gold was sold from that position I reported to you in the platinum
article (See January 15, 2003: Gold/ The US Dollar/ The Euro/Silver/
Platinum Reaction time Running Out For the Reaction), about $100 lower on
Platinum. The switch from 15% of the gold position held was to platinum.
The other 35% went at $390 into cash.
2/ The Exchange Stabilization Fund supplied gold into that price. I am
surprised that the existence of the ESF and its activities are not better
known in the gold community. I will endeavor to change that.
3/ Some but not much shorting.
Recall that I mentioned to you that a close above $371.50 gold would result
in an immediate move to and above $400. Well it made $390 within 9 hours of
the quiet close at $371.60 in the US. Was the move above $400 totally
erased or simply delayed?
My answer is gold is delayed, not derailed, on its way to $400, not so much
by the resistance at the $390.80 level but, believe it or not, by the
Indiscretions by Major Internet Gold Web Sites.
What has happened is that many once equity-bearish gold sites have grown
significantly over the past year not realizing that it was primarily the
new gold community that was responsible for that growth. Their heads are
still in their businesses, which runs from asking for donation-type
subscription income, subscription income, and investment management income
to small boutique-type, non-clearing brokerage houses. What they have not
realized is that they now carry influence in the gold community by the type
of articles they publish. I am not speaking about censorship but only
balance.
Well, they did it by posting two or three gold-bashing PR seekers without,
IMO, having a correct factual understanding, both of the history of gold or
the fundamentals of gold since early February. These shallow and incorrect
articles, interviews written and broadcast had no offsetting and
counterbalancing articles by invitation. The net result is that they simply
scared the hell out of the NEW gold community, which lacks commitment
anyway. Shame on you! The sites have gotten where they are today from the
gold community for not offering balance to the shallow, incorrect positions
they advertised with pictures of the speakers and a list of so-called
awards that would make anyone who did not know better feel their interview
was infallible and saying gold was vastly overpriced here and now!
Conclusion: They have not killed the Golden Goose, just wounded it. Now I
see the maximum price for the first leg of the gold bull market between
$408 and $414. I still feel that can be accomplished.
The shift to the second wave of the gold bull market will take place in
this general area. That leg will take the gold market to a significantly
higher high.
The rally in the US Dollar is simply that, a rally from an oversold
condition. No new bull market will take birth from a simple bounce off a
Fibanocci Resistance Line dead on the recent dollar low. If the US, for all
practical purposes, goes it alone against Iraq, then the bottom will fall
out of the dollar, meaning that recent lows will not hold. Going it alone
in Iraq means paying for it all. Organizing a war coalition means laying
off the cost of the war to others. Gold will rise and move through $400 and
take the gold shares along with it.
In no way is this gold market over! The Book promotion man is simply wrong
on his history of gold, wrong on his definition of inflation/deflation, and
even more incorrect on his interpretation of his 85 years of research by
failing to understand what gold shares were about during the greater period
of that time when gold did nothing. Yet the new uncommitted gold community
had their repeated ritualistic panic attack. Thank you gold web sites.
What to Do?
First be disciplined and put stop loss orders in or hold them in your mind.
Do not let yourself get hurt on margin. Get off that and do not use it in
the gold share arena again which is violent in normal times. Re-read my
conclusion above, every time you want to panic. Fax or email me if you need
your hand held.
Harry Schultz (http://www.HSLetter.com) published an excellent
