Saturday, September 8, 2012

ITZ Weekend Update: Gold, Silver, Copper & Euro

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U.S. nonfarm payrolls increased by only 96,000 last month, the Labor Department said on Friday, below the forecasted rise of 125,000. While the unemployment rate dropped to 8.1 percent from 8.3 percent in July, it was largely due to Americans giving up the search for employment.

The numbers fueled expectations that Fed policy makers will agree at next week's meeting to launch a third round of government bond buying, or quantitative easing, also known as QE3, to stimulate the world's largest economy.

Gold has rallied almost 10 percent since the start of August, pushing its 14-day relative strength index to 80, well above the 70 level that signals an overbought market to technical analysts. Gold pushed above $1700 to a 5-1/2-month highs after the European Central Bank unveiled plans for a bond-buying program to stem the euro-zone debt crisis. ITZ believes it can rally to $1800 near term and possibly to $2000.

Silver rose to its highest since mid-March at $33.71 per ounce. It was up 3.19 percent at $33.66 an ounce. ITZ play there is Silver Wheaton (SLW) targeting $40. ITZ suggested buying SLW back in April & May 2012 LINK and reiterated in August LINK

While gold & silver have broken out, copper is looking to do the same, the play there is Freeport McMoran (FCX). ITZ noted the Euro was set to rally as well as FCX last month LINK

click on charts to expand images

Jonathan Barratt, Founder of Barratt's Bulletin and Frank Holmes, CEO & CIO at U.S. Global Investors discuss the fundamentals for gold.

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