Tuesday, September 14, 2010

Silver has been showing more energy than Gold lately, a fact that has been reflected in my enthusiastic Silver touts over the last couple of weeks.  Late Monday night, the futures were pushing past the 20.185 Hidden Pivot midpoint of the pattern shown in the chart. This implies they are bound for at least 20.445, its 'D' sibling, although there are bigger patterns with commensurately higher targets that were identified here earlier. _____ UPDATE (10:25 a.m. EDT): The futures have rallied sharply this morning to exactly 20.445, pulling back by 20 cents thereafter.  If they get second wind, look for 20.515.

The reversal from just above the Hidden Pivot support flagged here yesterday is bullish, but December Gold stills need to push above 1258.80 today to 'actualize' whatever pent-up buying power exists. More likely is that the futures will hang out lazily for a few more days, but if and when the surge comes, the first Hidden Pivot with stopping power lies at 1264.40. It should be used a minimum upside target, but once above it bulls would have a more or less unobstructed path to at least 1290.90.

'Dueling impulse legs' characterize the daily chart at the moment, albeit with a slightly bearish bias. The clear implication is that the down-leg begun on Friday from 82.99 is likely to reach a minimum 81.53 before reversing. A tradable bounce seems very likely from that price because the pattern is so clear, and so I've recommended bottom-fishing --with as tight a stop-loss as you'd care to apply.  Please note that if the support should be breached more than slightly -- i.e., by 0.06 points or more -- it would suggest that a larger downtrend with potential to 81.32, or even 79.08, is in play. ______ UPDATE (10:42 a.m. EDT):  After taking a whoopee-cushion rally off 81.66, the Dollar Index is sinking once again, presumably to the 81.53 target or lower. _______ FURTHER UPDATE (11:12 a.m. EDT):  81.33 hit on the relapse and is holding, albeit precariously.

Coffee's fierce rally, now in its third month, may have met its match last week in the form of a Hidden Pivot at 198.80.  The actual high at 198.65 came within a hair of the resistance. If the futures should push above the high, however, we could expect the buying to continue all the way up to 197.40.  That target is derived from locating a new point 'A' where 'C' is. _____ UPDATE (2:21 p.m. EDT):  Today's moderate rally hasn't changed the big picture, although it now seems possible the futures will do a death rattle up to 202.95.  You can short there with a tight stop if it happens before Wednesday's close, but if the order survives you'll be on your own. (The order expired with the futures having rebounded no higher than 197.60.)

End-of-summer travel delayed this report on Premium Exploration (TSX symbol: PEM) by a week, although we did issue an informal “buy” recommendation on the junior miner in the Rick’s Picks chat room a couple of weeks ago.  The Canadian-listed stock was trading for around 45 cents a share at the time but has since moved up as high as 57 cents, where it closed yesterday. Based on technical analysis, we’re projecting upside potential over the near term to 64 cents, or perhaps 67 cents if any higher. These projections have a horizon of about 2-3 weeks, but there are longer-term forces at work that augur still higher prices. Stock charts aside, we rate Premium’s shares a high-potential speculative bet for the long-term. The company is well managed under CEO Del Steiner, and its Idaho site has yielded some very impressive core samples so far: 5.75 grams per metric tonne (g/t) over 76 meters, 3.65 g/t over 74 meters, and more than 9 g/t over 25 meters.  Moreover, the larger structure from which these samples were taken is mostly unexplored. The Central Idaho gold region has already produced more than four million ounces of gold from mostly placer projects, but Premium’s site could conceivably double that figure over time. One reason investors are especially excited about the Orogrande fault zone is that it is geologically similar to Nevada’s Carlin Trend, which has produced more gold than any other mining district in the U.S. Spreading the Word We toured Premium’s central Idaho site on August 25 as guests of the company in an entourage that included such seasoned veterans of the precious metals world as radio host Al Korelin, Roger Wiegand, Sean Brodrick, Marshall Berol and Dan Pisenti.  All came away sufficiently impressed by Premium’s operations, most particularly at Friday-Petsite, to have