New Thread as requested by Wirral Owl.

6 Months Chart:-



10 Day Chart:-



Cheers

Ash

after the negative things i said yesterday, lets have a couple of good thins to say:

- the stock opened up today with a a small up gap of 1.5%. if it is to keep up its gains today, then it is possible that the stock has managed to evolve a rising trending channel the support line of which lies along the lines between the last bottom and the bottom created by last friday's closing price.

- i disagree with ashley on the macd dropping. yes the moving average lines were dropping throughout last week. but you can see the faster one is rising up to cross the slow one at high level, this bides well for the stock. remember macd is a lagging indicator. one one to get advance warning is to look at the histogram instead. the latter has been rising from negative territory throughout last week and is about to hit level zero. as histo hits level zero the moving lines cross each other and since these two lines currently lie well above the zero level, then they are bound to cross at well above zero level too. this indicates that momentum continues to exist.

Arch, are we at a market top with AVM considering POG has closed well down on the day from its peak??????????. Your help much appreciated.

GF

goldfinger,

not necessarily.

i was listening to mr lock, a manager of a fund called 'oyster catcher', a bear and devoute elliot wave follower and one whose been accurately forcasting falls in this market for well over a year ago when most were expecting the market to bottom up. mr lock, who is a frequent guest on cnbc, said that gold will remain bullish above $350 pe roz. so we have long to go yet.

additionally, while the war issue remains hanging in the air it is unlikely that gold prices will undergo dramatic drops.

i therefore expect the slight drop in gold price to be a technical retracement.

however the stock appears to have got stuck at its present range. so if i am a holder sitting on over 20% profit i would be contemplating bailing out until a new phase in the development of this stock has evolved. remember a stock spends 80% of its time going nowhere and only some 20% moving up or down.

Arch, many thanks for that.

GF

goldfinger,

the article below regarding gold price movement published in the ft website may be of interest to you.



Overbought gold lines up for pullback
by Vince Heaney in London
Published: February 7 2003 14:54 | Last Updated: February 7 2003 14:54


After years languishing in the lower reaches of investment performance tables, gold has re-emerged into the limelight as a hot commodity.

Reflecting the precious metals resurgence, from a list of 1,862 unit trusts and OEICs the top-performing unit trust over the last one-year, three- years and five-years is the Merrill Lynch Gold and General fund. Over one-year the Merrill fund returned 40.9 per cent, more than double the next best performing fund.

Investors in both the commodity and gold stocks have enjoyed impressive returns, but following a $100 an ounce rally in just over a year, from a technical perspective golds advance is looking overstretched.

After closing at $381.50 an ounce on February 4 the spot price pushed to news highs of $388.50 the following day. However, by the close of business on February 5 the spot price had dipped to $371.75, forming a reversal day. A reversal day is a chart pattern that can indicate an imminent change in the direction of the trend. At a market peak, prices make a new high during the day but close lower. In this instance the wide daily price range on February 5 adds weight to the potential reversal.

An upward-sloping trendline can be drawn beneath the sharp advance in gold since the start of December 2002, which has taken the spot price from $315.75 to this week's high of $388.50. Support from this trendline currently lies at $365, just beneath current close of $371. A reversal pattern followed by a drop back to trendline support suggests investors should tread warily as a larger pullback may be in prospect.

Momentum indicators show that the gold market is in a very overbought condition. The Relative Strength Index (RSI) on the weekly chart currently stands at almost 91. The RSI runs from 0 to 100 and values above 80 indicate an overbought market. A value above 90 on the weekly chart has not been seen in the last five years.

If trendline support is breached at $365 investors should look for a correction of the move up from $315.75. A 38.2 per cent Fibonacci retracement would take the spot price back down to $360.70, a 50 per cent pullback would reach $352.10 and a 61.8 per cent correction would hit $343.50. Beneath the latter level the May 2002 highs offer support just above $330.

I would buy on dips as long as we hold above $330, said Chris Locke of technical consultancy Oystercatcher BV. Mr Locke also identified $330 as an important level in his longer-term view of the market.

I lean towards the long-term bull case for gold but am very wary, he added. Mr Locke follows Elliott Wave Theory, which looks for moves in the direction of the major trend to unfold in five distinct waves.

A five-wave move is nearing completion up from the lows between $270-$280, but the wave structure does not look strongly impulsive. The waves overlap at the beginning of the move which suggests the whole move could be corrective in nature, said Mr Locke.

The jury is still out on some of the more bullish arguments for gold. A monthly close above $398 is needed to confirm the long-term bull case, being the 88.6 per cent Gann retracement of the whole move down from the March 1996 highs at $417.70.

But for now the short-term reversal pattern and the overbought nature of the market suggests a correction is needed before any assault on the $398 level can be attempted.

goldfinger,

and here is another article appearing on the cnn website in the form of reply to an investors question about selling stock and buying gold.


gn up for the Ask the Expert e-mail newsletter


NEW YORK (CNN/Money) - I'm considering selling my stocks and investing my money in gold. What do you think of this move?

-- Lucy, San Francisco, Calif.

Not much, Lucy, not much. Oh, I know that when times get scary, people rush to the security of hard assets like gold, and that prices have been booming lately as it appears ever more likely that the U.S. will go to war with Iraq.

Related Articles

Mutual fund guide 2003

Most absurd tax claims

Best funds for 2003



On the days leading up to Secretary of State Colin Powell's speech outlining the case for war last Wednesday, for example, the price of gold bullion in New York climbed to just under $380 an ounce, it's highest level since 1996.

And gold stocks have also been among the hottest performers in an otherwise dismal market. Through the 12 months ending in early February, for example, Morningstar's Precious Metals fund category (which consists mostly of funds that own gold mining and refinining stocks) was up a stunning 46 percent -- that's right, 46 percent at a time when the S&P 500's total return over the same period was a negative 21 percent.

Yes, but...
So why am I not urging you to unload your stock portfolio now (IMMEDIATELY!) and snap up some gold bullion or gold stocks or funds?

Several reasons.

First, they're notoriously volatile. That's great if you manage to buy them before one of their occasional spikes in price. Obviously, the people who bought gold funds a year ago are congratulating themselves (deservedly or not) for being geniuses.


But if past gold cycles are any indication, people usually start buying only after the runup. Prior to the Gulf War in 1991, for example, gold prices soared to just under $405 an ounce. But people who bought in expectation of further gains were disappointed, as the price of gold began sinking thereafter because investors became convinced the war would be a short one.

Big gains in gold stocks and funds have also lured investors in, only to disappoint them soon after. Gold funds gained more than 90 percent in 1993. But they lost 48 percent over the next five years.

But times are really scary...
Who knows, maybe this time will be different. Maybe gold bullion and gold stocks and funds will continue to post big gains. I wouldn't count on it, though, since gold isn't the type of investment that generates steady gains over time.

Gold funds on fire


Fund Ticker 1-year return
First Eagle Gold SGGDX 65.5%
Van Eck Int'l Investors Gold INIVX 52.4%
Tocqueville Gold TGLDX 45.4%
American Century Global Gold BGEIX 39.5%
Fidelity Select Gold FSAGX 37.6%


*Returns through Feb. 5, 2003
Source: Morningstar, Inc.

It tends to give its gains in spurts with some extended down periods in between. Buy in at a high, and you can spend a long time waiting to get back to even. Of course, maybe you'll be smart enough to know when to jump in and then get out at the right time. But to my mind, that strategy is more akin to speculating than investing.

I suppose you can make a case for moving a bit of your money into gold -- say, maybe 5 percent or so. The rationale for doing that is that gold prices move in sync with stock prices. So even though gold itself is highly volatile, adding some to your stock portfolio can lower your portfolio's overall volatility because stocks and gold don't zig and zag at the same time.


But frankly, I'm not a big fan of using gold as a diversifier because I think you can find other investments that provide decent diversification but with better long-term return prospects than gold. And if I did use gold to increase my portfolio's diversity, I'd use gold stocks or, better yet, gold mutual funds, not gold bullion, which has higher transaction costs that cut into your gains (assuming you have gains).

So if you want to join the gold rush, my advice is keep your investment small, and stick to gold mutual funds. And don't forget that the same forces that drive up gold prices and gold stocks quickly, can push them down just as fast.


--------------------------------------------------------------------------------

Walter Updegrave is a senior editor at MONEY Magazine and is the author of "Investing for the Financially Challenged." He can be seen regularly Monday mornings at 7:40 am on CNNfn.

avm,

down this morning, but gold price is up some $3/oz, so expect the avm price to improve. and while the situation in iraq remains unresolved, expect old price to rise further. i understand the next targer is $395/oz.

We seem to have had a few bad days, Arch. Will be asking Evil Knevil this evening where he thinks POG is going. Will give replt wed teatime.

regs GF.

heard chris lock this morning on cnbc: below 330 is bearish, above 398 is bullish. there has been a slight improvement in the pog and avm responded by rising a few percentage point having opened the day in the red.

Well Evil is more Bullish on Gold than he as ever been. Says the low POG price is a great opportunity to buy. Hes still looking at POG at $750 long term.
Feels dollar will weaken even further. When POG gos up he feels it will really take off.

GF.

good news goldfinger. and if this is correct then the current drops have been none other than atechnical corrections. yesterday gold rose be some $4.5 but as and avm followed in sympaty rising soem 3.5%. as i write, however, gold is down by over $5.

i would have thought as war gets closer the rush for gold wil intensify and stock sell off. the opposite appears to have happened. mind the usa market has another 3.5 hours to run during which anything may happen.

have just found out that a massive seller has just been cleaned out and that the shares have gone to a very good home , that must be one of the main reasons for depressing the share price past couple of weeks ,should be bullish from now , price ticked up after sales .

Yes BUD its good to see it ticking back up to 35p. There is speculation that the deal was a matched trade and that the buyer is indeed another Gold miner.

Do you feel that we could be on for a merger or a takeover?.
GF

avm,

the stage has been set for better things to come!

up today by over 10%. the dojji candlestick of yesterday status as a patteren reversal has been confirmed.

macd has touched zero on its way up. importantly, there has been a divergence between the histogram and the price action of late. the histo rose as the price went down. and the same histogram has plotted a bullish w.

sotchs and rsi are not particularly busslis as they stand at about mid range and pointing near flat.

all moving averages are heading up. 9 day sma has crossed over 18 day sma.

there has been a danger of head and shoulders developing but this has now gone. instead there appears to be the development of a rising trend. i say appear to be as it is early in the day to confirm whether this trend is going to develop or not. the situation will become clearer by the end of this week.

in the event that this trend is confirmed then the next target for this stock would be around the 40+ mark, depending on the true morphology of the trend.

last but not least, pog is up again.

Fingers crossed Arch.

GF.

.

Hammer Bottom/Dragonfly Doji on Friday:-

Nows the time to be back in Gold stocks. POG at 7 week high last night. Analysts around the world predicting gold will see new highs.

AVM the perfect play on POG at its low price of 26p. Now time to get in at these low levels.G

i`m in already and very disappointed so far, perhaps it will go now.

"i`m in already and very disappointed so far"

GOOD, I hope you are really pieved, preferably really pissed off!

However until it breaks 26.50p you are completely stuffed IMHO

lolol!(;-)0