Richard Russell - The War In Gold & A Danger Sign For Stocks

Richard Russell - The War In Gold & A Danger Sign For Stocks

On the heels of continued volatility in key global markets, the Godfather of newsletter writers, Richard Russell, discussed the war in the gold market and a danger sign for stocks.  This is a fantastic piece where Russell included several charts and some outstanding commentary.  King World News even included an incredibly important note for gold the bulls from Russell’s November 7th, 2012 comments.
Richard Russell:  “The trend continues bullish.  This is confirmed by the DIAs (chart below) breaking out to the upside. Remember, use a price of 154 as your safety level.  If the DIAs drop blow 154, sell them and take a small profit.  Note that the RSI is almost overbought, and the histograms are trending lower.

I'm pleased to include the chart below of GLD.  Here we see gold climbing above its 50-day MA, and at the same time rising above its trendline.  RSI and MACD are both positive, suggesting that the base that has been building in gold is now complete.

The P&F chart shows GLD climbing to the 130 box and perhaps needing a bit of consolidation. Therefore, it would not surprise me to see gold down a bit today.”  (KWN note:  Russell’s comments were written first thing in the morning and gold was subsequently hit hard today.)  “Of course, a rally to the 144 box would be extremely bullish, and would point to much higher-priced gold. 

For the last month or so, we have been bombarded with every kind of story, opinion and rumor (most of them negative) about gold and gold mining stocks.  Already, gold has rallied past the point where those who had sold their gold were ready to reenter.  So much for trading in and out in a bull market.”

King World News note:  The following comments were from Richard Russell on November 7, 2012, and they are as true today as they have been during the entire bull market in gold: