Closer look at $Gold

Gold shows a  clean break out in its long term bull trend.  Silver has failed to confirm this but could be lagging.  There are a number of developments with the FED and China that is going to shape our next 2-5 years.  I will go into further detail in a separate post.

A look at Silver $SLV

Silver is definitely lagging Gold on this break out.  One of them is giving a false signal.  In light of the Fed raising the discount rate and China reducing its demand for our debt.  We have an ugly 2nd half of 2010 setting up.  Fed anticipates withdrawing all of its stimulus by October 3rd 2010.  All of these things will reduce paper currency in the system and reintroduce deflationary forces.

If Silver can take out the high  it will probably run for miles...and to me that would signal the end of our currency.