Tuesday, February 27, 2007

Gold, Google and ECU Mining

Despite the recent highs for gold, our google sentiment indicator remains stubbornly low. To put it in a nutshell, it has not breached the highs set during this multi-month correction period for gold.
Currently it is at 698,000 google hits on gold but the high remains at 850,000. When the bull bellows again, google will hit 1,000,000 for gold!
We also had a rare occurence today, both gold and the US Dollar took a beating at the same time. Strange bedfellows indeed, but expect normal service to resume soon.
Issue 3 of The Silver Analyst is pending and ECU Mining is an object of study. We project, speculate and analyse this winning stock. But how has it been leveraging silver since it became a favourte of the silver bugs? We answer that in issue three.

Thursday, February 22, 2007

Weekly Updates from The Silver Analyst

Prospective subscribers may like to know that weekly updates are sent out at the weekend as well as the monthly issues. This keeps everyone up to date on the key indicators that we follow. As things begin to heat up, these are upped to a daily basis as the situation demands. A commentary is also attached to complete the weekly update. An example is shown below with made up numbers which are subscriber only information.

London Silver Fix Price: $30.00 (+$5.00 on week)

RSI: 1.00 (-0.10) (70 overbought)
RMAR: 1.00 (unchanged) (1.30 overbought)
SLI: 1.00 (+0.10) (1.80 overbought)
GSR: 1.00 (-0.10) (15.00 overbought)

SLD: 1.00
GLD: 1.00


RSI:Relative Stochastics Indicator
RMAR: smoothed price Relative to 200 day Moving Average Refined
SLI: Silver Leverage Indicator
GSR: Gold to Silver Ratio
SLD: Silver Leverage to US Dollar on a four year rolling basis
GLD: Gold Leverage to US Dollar on a four year rolling basis

Wednesday, February 21, 2007

The Silver Bullet!

Having watched silver begin to wilt from its challenge to $14, the US Labor Department obligingly lends a hand by publishing higher than expected CPI inflation figures. Wall Street apparently expected 0.2% instead of the announced 0.3%. Hardly seems the kind of figure that would propel silver up 60 cents and gold $23 but there you have it.
The truth seems more to be based on opportunistic buying on a price dip. Hedge funds? No doubt they palyed their part, but the dips are being aggresively bought. Now we see silver poking its head above the $14 maginot line. We expect the silver tanks to roll on!

Tuesday, February 20, 2007

The $14 silver barrier and the Barclays Silver ETF

Silver was rebuffed down to as low as $13.65 as the $14 continues to provide stiff resistance. To us it is still only a matter of time.

Recent chatter about Barclays lending out their ETF assets to short selling hedge funds may surprise us but when the motto of these institutions is "make as much money as possible" it should not surprise. In regard to our own silver ETF, could I not ascertain three things:

1. Are Barclays allowed to do this with silver?
2. If so, how much silver is allowed to be leased out at any given time?
3. If so, how long is the lease period?

The answer to 1 appeared to be "No". The original schedule says:

"The trust is not actively managed. It does not engage in any activities designed to profit from, or to ameliorate losses caused by, changes in the price of silver."

In other words, hedge funds seeking to lease silver to take advantage/engineer a silver price change would be to the profit of Barclays. Furthermore, the schedule states:

"The trustee's arrangements with the custodian contemplate that at the end of each business day there can be in the trust account no more than 1100 ounces of silver in an unallocated form."

This seems to be purely on the basis that the ETF only deals in 1000oz LBMA bars. Any leased silver is by necessity "unallocated". Basically, I have had a fairly good look at the schedule and see nothing about lending or leasing silver out to third parties. If anyone see otherwise in this or the new schedule I would be interested to know. In the meantime, questions 2 and 3 are irrelevant.

Saturday, February 17, 2007

Update on intraday Google hits and Gold price

Yesterday I reported on how the google hits on gold were fluctuating a lot on an intraday basis. However, the test was what would the "end of day" value settle down to? This is the value I use for my daily google sentiment indicator.
The answer was that it had dropped down to 736,000 -comfortably below our resistance level of 850,000.
In other words, Google and Gold says no breakout yet either!

Friday, February 16, 2007

Latest on Gold Google hits

On the advice of an email a reader sent, I decided to check the hits on an intraday basis, no more than once per hour.

Yesterday, the "closing hits" value which I record every night at the same time was at 775,000. However, on our intraday checks it has progressed from this to 860,000 which was at our "resistance" level and has now smashed through to 935,000 and currently is at 901,000!

Will it settle back down to a below resistance value by the end of the day before we make any rash decisions about price breakouts? Note that while this was all going on in google, the actual gold price has not made any significant progress (currently up 40 cents).

Quite possibly we are seeing some kind of "lunchtime" effect where more gold "chatter" is going on during the daylight hours and this is being picked up by the Google web robots. That is why it is important to check for the hits value at the same time of day using the same search keywords.

I'll report on the latest "end of day" number before bedtime.

Since this is a silver oriented blog, we must also report that the google hits on similar silver keywords has never exceeded its google hits high since the post $15 correction began!

Thursday, February 15, 2007

Update on Google hits and Gold price

As suggested in our gold and google articles, the 850,000 hit level for gold investment keywords proved to be a level of resistance.
Having hit a high of 841,000 on Tuesday, we have dropped back two successive days to 775,000. The 850,000 level has proven steadfast again - but for how much longer?

Tuesday, February 13, 2007

Administration: bouncing emails from aol.com

Sometimes investors will sign up but problems can happen with email when I attempt to deliver newsletter information to them. There are currently two email addresses bouncing back and they are both at aol.com, can you check you are okay with receiving emails?

As a test of email reception, you should all have received a weekly update yesterday (Monday).


Sunday, February 11, 2007

ECU Silver Mining Inc

A great stock for those who bought in 2003-2005 and massive leverage on the price of silver. We are adding it to the Silver Analyst Stock Composite index and we shall also do the analysis on it for the next issue. Suffice to say many will see a final 5th Elliott wave about to ensue for this stock.
Read more in issue 3 of The Silver Analyst.

Saturday, February 10, 2007

More on the silver leverage indicator (SLI)

First may I point out that the free issue one contains no information on the SLI tool because I only discovered the indicator as I was preparing for the now available issue two. However, issue one describes the concept of silver to gold leverage that is the foundation of the indicator.
Some people have also asked for the formula for the indicator. It is a simple leverage formula that should be easily reproduced by any competent analyst. I was just going to keep it to myself but on second thoughts and in the interests of a scientific repeatability, please email me to enter inot a discussion on the matter.
The SLI came close to issuing a sell signal some weeks back (before I discovered it) but drew back. This is clear from the public graph I put out. What does this tell us about the next move for gold-silver and this indicator? What does it tell us about the price expectation for silver at this current stage in the generation bull market?
More follows for subscribers in the upcoming weekly update.

Thursday, February 08, 2007

Updating SASC index

The Silver Analyst created and follows the Silver Analyst Stock Composite index, a mix of producer and junior mining companies. We shall now be adding Abcourt Mines, Scorpio Mining, Silvercrest Mines amongst others. This will bring the total number of stocks to 15 I hope.