Monday, August 4, 2008

XAU character change

The behavior of the mining stocks has been pretty consistent throughout this bull market. Every new upleg has resulted in a higher consolidation zone. Today we may being seeing a significant character change in the mining stocks. Unless the XAU can regain the $160 level quickly we will have a breakdown of the consolidation zone that hasn't happened at any other time during the PM bull. Considering that gold is quite a bit above the recent lows of $850 it would seem that the miners are saying gold is going lower.

I still think commodities are trying to tell us that the world is slipping into a serious recession.