Teach Talk Trade Day Trading & Technical Analysis

Market Predictions and Gold:

Today, I’m going to give you my predictions to the markets — a general guide you can use to determine the trends in all the major markets we cover.

My projections are based on current and past market signals and from a variety of indicators. I watch these indicators closely for a global market perspective.

Whether you’re attempting to merely protect yourself or aggressively grow your nest egg, one should have a global outlook as a roadmap.

In fact, with all that’s going on in the markets right now, I’d say it is crutial to see the big picture

Why? Because we’re going to see wild swings in virtually all markets … lots of fake-out moves … new trends emerge … and old trends become reinvigorated.

That’s all very understandable when you consider the forces that are gathering steam … that the ones I’ve have been watching for the last few years:

1)  The sinking dollar, which has much further to fall.
2) A crumbling empire of debt in the U.S. of which the subprime crisis is just the beginning.
3) Inflation that is about to explode during an election year, yes it is here folks. 

Despite all the hoopla, make no mistake: The U.S. is already in a recession. Housing and real estate is a mess. The financial sector has imploded. The auto manufacturers are still wallowing in a depression in their sector. And manufacturing in general in this country is now gone, for good.

Second, in  contrast to the U.S., Asian and emerging economies continue to surge. That’s true for China and India, as well as the rest of Southeast Asia and Latin America.

As a result, soaring prices for natural resources are now entering their next phase — a rapid acceleration that will take most investors by surprise, and turn out to be the most profitable up-move ever!   This surge will occur unless the worldwide economy goes into recession.
Gold: Short-term and long-term, gold’s bull market is very strong. But it’s going to experience some wild swings in 2008.

Major support is way down at the $850 level. If that level is broken on a closing basis at any time, gold could fall as low as $780.

On the upside, gold is in uncharted territory, record highs. The key points to watch are the $1,000 level, which should pose some psychological resistance, followed by $1,250.

Your general strategy toward gold should be: Buy weakness, and buy dips that hold the $850 level. Hold with the objective of seeing gold trade well over $1,250 later this year.  You may want to use retracements to our T8 model. Make sure you stay on top of all commodities by subscribing to our Morning Call in which we have analysis of 21 commodities.

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