Wednesday, July 27, 2011

Gold Places New All-Time Nominal High at $1627.30

Live New York Gold Chart [Kitco Inc.]Gold has passed $1625 this morning, placing a New All-Time Nominal high of $1627.30.Gold looks set to challenge Big Jim Sinclair's $1650 possibly as soon as the end of the week.

Look for support at $1605-$1610, with even larger support at the round number (and previous resistance) $1600.
The amazing thing about the gold market right now is that it is setting new all-time highs, is near Big Jim's $1650, and yet gold is not overextended at all.  This thing has major room to run from here.

*Update:  $1629.60 and $41.55

Live New York Gold Chart [Kitco Inc.]

Silver is also moving sharply higher again this morning, and is vaulting higher literally as I type to near $41.30.
Any last ditch efforts by Blythe and friends best be undertaken soon, or the next silver drive-by shooting will merely push silver back down to $42.50!  Should we make it through today unscathed by the cartel, silver is set to potentially make a strong move to the upside over the next 5-10 trading days.   Keep in mind that the bipolar news reports on the debt ceiling negotiations may have a temporary effect on gold and silver, and will likely be used to try to cap the metals. 

Live New York Silver Chart [ Kitco Inc. ]

Long term however, a default makes gold and silver sharply rise in value overnight, while a $2.3 Trillion debt limit increase will correspond with a similar increase in QE to purchase those bonds. 
Basically a classic Win-Win for gold and silver holders.
Bix Weir of Road to Roota has been stating that the "good guys" will not agree to a debt ceiling hike, inducing a US default and subsequently taking down the banksters.  We shall see, we won't have to wait long now.
Personally, if the unthinkable happens and an agreement is not made, we think it will be the result of simple incompetence of Obama and Congress.