Careful, quiet accumulation

[midwayer]

Richard Russell
Dow Theory Letters
July 8, 2004

The Dollar Index is now trading below its 200-day moving average (red line), and its 50-day MA has now turned down. The blue histograms at the bottom of the chart, after being weakly above the zero line, are now turning down.
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The renewed weakness in the dollar has not been lost on gold. Today August gold surged over nine dollar to close above 400 -- again. On June 24 August gold closed at 403.50. This was the highest gold since mid-April. Therefore, I would consider any close by August gold above 403.50 as a technical plus.

I can't prove it, but after watching gold action since 1960 I have to rely a lot on my "instinct." My instinct (or is it my guts?) tell me that gold is under careful, quiet accumulation.

Richard Russell
http://www.321gold.com/editorials/russell/russell070804.html

[iconoclastic cat]

1. Okay, this is ancient Sumerian to me. Could you please decode it?

What does this mean, DUers?

[7th_Sephiroth]

2. it means

people, for some reason, are buying gold, the typical reasons are anticipation of a strong weakening of a dollar, or mabe those buy gold coin advertisements are getting lots of customers

[midwayer]

3. It means

The dollar is under pressure and caution is warranted

It means commodities could start picking up steam

I general not good for stocks or could be pre-curser to a hit in the market, but not necessarily a crash

Caution warranted

[midwayer]

4. I would add

this could be reflecting the negatives in the overall economy

but needs to be monitored closely for further signs of erosion