Technical Analysis of Precious Metals: Name Your Market, Bull or Bear

In the past week I've read two very convincing articles based on technical analysis of the previous metals markets. One article, "Beware Of Short Sellers!" by Peter Degraaf makes a convincing case that we are at the beginning of a large move up in gold and silver, with almost ideal conditions before us for a strong rally. On the other hand, I was almost convinced by Clive Maund's Bottom Fishers Beware, who provided strong reasons why he thought gold and silver just looked awful right now. Get out, sell, it's going to tank. But I think he's wrong. The real point here is that technical analysis can lead people to all sorts of conclusions, none of which have much to do with the actual future. Beware. Today's strongly positive action points to a strong market and seems to contradict the negative view Clive Maund offered earlier this week. I think Peter Degraaf has it right - but who knows? But for the long run, ignoring the twists and turns of technical analysis, the fundamentals point to one very strong bull market ahead. Even without geopolitical insecurity, there are many reasons why the dollar can get weak and why gold and silver, even with a strong dollar, are quite cheap right now. Invest in precious metals to beat the market in the long run!

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