Gold - Looking Good!

Good morning all,

DEC GOLD is trading slightly below Tuesday's high of 735.50 but the uptrend is healthy and I believe this market is ready to kick it into high gear. Keep your eye on the DOW futures today. I won't be surprised to see a positive day in the Stock index futures but there will be a hangover from yesterday's rally so look for the markets to stumble as the euphoria from the interest rate cut starts to wear off.

A logical scenario would be to see a rally up to but just shy of the all-time highs then a major drop in stocks across the board. The only question is how close will they actually get to the previous highs. My guess is that the indexes are only a day or two away from failure.

A fairly safe play, in my opinion, is in the treasury markets. We could see the 5-yr. notes yielding 2-2.5% by the first quarter of 2008 and that means big profits for those of you long Treasury futures. Stay tuned.

Dale F. Doelling
President and Chief Market Technician
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