HSL / Newsletter Sample
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Le Metropole Cafe

October 2004

5 rallies & 4 corrections. Because each rally bettered the prior rally by a mere $5, it discouraged gold followers from placing big bets. Yet the uptrend has prevailed. Odds favour its continuation. A break below 395 would shatter that & test lows in the 380’s (see gold in Back to the Futuressection for buy/sell tactics on

handling both breakouts & breakdowns as a guide for shares & futures).

••I reported this in Gold Charts R Us, but I must report it in HSL also, as not all Hslms get GCRU. Here’s an interesting letter:“Dear Uncle Harry, Whatever happened to the commercial banks' gold derivatives issue? Did it go away; is it still there? 2yrs ago there was talk (from Jim Sinclair, etc) of a crisis if gold went above 350 (or 360, 370, etc), but nothing seemed to happen. It would be good to have a post mortem comment from U on this. Best wishes, FW, London, GCRU & HSL/FMU subscriber.” Dear FW, Good question. I don’t have a final answer. JS originally put out the theory some mines/banks would hit trouble with gold at these prices. But they haven’t. I believe the answer is partly the mines have bought back much or most of their derivatives. 2nd, govts may have quietly bought up some of these derivatives to avoid bank/mine closures.

In no uncertain terms, the Bank of China’s governor has shown his govt is determined to increase the levels of gold held by Chinese citizens. It’s much easier, PR-wise, to encourage this than for the Central Bank to go into the open mkt to buy gold for its reserves. Xinhua News Agency quoted Zhou Xiaochuan, central bank governor, saying "Trading in gold will provide another choice for individual investors who keep their money in bank accounts due to a lack of desireable investment options." (see 2 recom gold charts pg 11)

Good news for traders & non traders: 1. For those of U who don’t have time, or skill (yet) to profit from actively trading gold shares, U’ll be interested to know I’ve introduced a new format in my Gold Charts R Us service. I’ve coined a new word for part of it: Trendivestors—a 1-page table that lists in great simplicity, what to buy, when & where to sell, basis medium term trends. This is the middle ground between buy&hold (which doesn’t pay off) & daily monitoring/trading. This table is designed for less active investors. 2. We’re also starting a simplified table under each chart for traders, to make their lives easier. I think we’ve radically improved GCRU. I hope U’ll give it a try. With gold now having turned the corner, IMO, this is a good time to get active, before shares get overbought. To order the new style GCRU, for 2- week trial or 3 months, or 6, 9, 12 months, please Click Here.








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