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Gold Rose to New Highs,
Silver Strong Above $27

The Aden Forecast Weekly Update, May 27: Gold rose to a 20 week high on May 26th, reaching its January highs, while gold shares are holding near their highs for the year posted last week. Silver is strong above $27. The chart below shows gold rising strongly in an 'A' rise, while its indicator is reaching a high area. This means that gold's rise since March may be nearing maturity. We'll keep an eye on it, but for now gold's rise is underway and strong above $1830. The HUI index (gold shares) is strong above 303. Gold got a boost from the falling bitcoin this past week. Keep your positions.

Copper has been softening but today's rise and the rise in resource in general shows it's still strong above $4.40. Crude oil closed at a new high for the move today and it's strong above $62. Keep your positions.

The U.S. dollar index hit another new 4½ month low this week. It’s getting closer to the 89 level. And once it closes and stays below the 88-89 level, the dollar index will be at a new low and it could then fall sharply. This would be very bullish for the metals and currency markets. Currently, the currencies remain strong and bullish, and we still advise buying and keeping your cash in the Canadian, Australian and New Zealand dollars, and the euro. If you have the Swiss franc, it’s okay to hold but don’t buy new positions. The British pound is also looking good.

Interest rates softened this week. This will likely continue in the weeks ahead. Even though there are hints the Fed may lighten up on their bond buying, we don’t think they’ll be quick to do so. This means bond prices will likely stay under pressure and it’s best to avoid bonds for now.

The stock market rebounded this week. But the market remains overbought, signaling the upside is still limited. That’s why we recommend selling some of your stocks and maintaining caution. If you haven’t sold yet, we advise selling Transport iShares (IYT), Nasdaq (QQQ), Dynamic Software (PSJ) and iShares Russell 2000 (IWM). Keep the Dow Industrials (DIA) and Walmart (WMT) for the time being.

Editor’s Note: Comments above are by Mary Anne and Pamela Aden, co-editors of The Aden Forecast, 1 year, 12 issues, $250. The Aden Forecast is considered one of the most influential investment publications in the world today. The newsletter, now in its 40th year, specializes in the U.S. stock market, mutual funds, U.S. interest rates and bonds, the international stock and bond markets, the foreign exchange and precious metals markets. For more information visit www.adenforecast.com.

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