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Dead Cat DropBob Moriarty Did I happen to mention that after a dead cat bounce, the markets tend to go down? And if this past two weeks has been a dead cat bounce, it's been so violent on the upside that I sorta have this feeling we are going to fall off a cliff. Everyone in the known universe is convinced gold can only go up. All I read is wizards talking about gold and how high it is going to go. Hogwash. Gold has gone up seven days in a row as of Tuesday, January 3 and up over eight days is virtually unknown. If it goes up on Wednesday, kiss it goodbye on Thursday. January is seasonally bad for the gold indexes and the metal. Every time I say gold might go down, a bunch of cockroaches crawl out of the woodwork, and start flaming me. None of them even bothers waiting until I might be wrong, they need to let me know as soon as I write my opinion, just how wrong I am. Well, folks, it looks like gold and silver have topped for some time.  chart courtesy of StockCharts The best and most valuable chart I know of compares the ratio of the XAU to Gold. If you look at the chart, it very clearly shows the top in December of 2003 which was a major top. And another top in November of 2004 which was a decent size top, and we are back in top territory. You don't have to believe me but please don't ignore what that chart says. There are no gurus, only fools who believe they can predict prices. I can't and don't even try. But if this isn't exactly what a contrarian would think of as a top, I will eat my hat. [I'll go you one better, I'll eat my precious Cardero hat]. We have all the signs in place and I'm going to a larger cash position. Bob Moriarty 321gold Inc |
