By Rick Ackerman, GoldSeek

Stocks are in a warp now, moving in a parallel universe with no apparent connection to reality. The worst housing news in nearly 50 years pushed shares lower for a relative blink of an eye yesterday, then it was back to the races after Helicopter Ben affirmed for the umpteenth time that the Fed would not be tightening any time soon.  Recall that it was just a week ago that the Fed announced it would raise the discount rate by half, to 0.75 percent. Even though this administered rate has become largely irrelevant to bank borrowing, the markets reacted as though the announcement had been momentous. The dollar soared, gold fell, and the unbiased observer might have concluded that something important had occurred. In fact, nothing of significance had changed. That’s because banks that face short-term stresses no longer have to borrow directly from the Fed; instead, they borrow “excess reserves” from each other at the federal funds rate – the rate the Fed conspicuously left unchanged last week at 0.25 percent.

Wall Street has been assured of easy money for so long, and so many times, that one might have expected Bernanke’s latest re-assurance to have had no impact whatsoever. But the fact that it moved the markets higher does not necessarily mean traders thought there was anything new or significant in the Fed chairman’s speech. No, they bought stocks simply because they believed that’s what all the other traders would do.  It therefore wasn’t the speech itself that caused stocks to rally, but rather the fear of being left in the dust when others reacted. And because there was no way to construe Bernanke’s message as bearish, the only option was to go with the flow and buy stocks.

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By Andrew Mickey, GoldSeek

The Associated Press calls them “fully invested bears.”

It’s the most unique phenomenon of this rally. They are the large and successful group of investors – both individual and institutional – who see the economic reality around them and are naturally bearish. However, they’re still fully invested.

That’s where we’ve all been in the past few months. We know the reality. We haven’t forgotten history will likely look back on this rally as a bear market rally. But we still have recommended buying stocks and continuing to do so until, there’s really no other way to put it, they start to go down.

Since the rally began, every week has been filled with reminders of the old trading adage – the tough trade to make (i.e. buying stocks when economy is down) is usually the better trade.

Still though, as the “fully invested bears” turn into “fully invested believers,” the most discerning investors are focusing on when this rally will end.

The Greatest Test of All

So far the rally has passed every “test” in the past few months.

Earnings seasons in the midst of a deep recession – no problem.

Bad news after bad news from the economy – no worries here.

Memories of the market decline from late 2007 through March of 2009 when the S&P 500 lost almost 68% of its value – totally forgotten.

Together they formed one of the greatest walls of worry in decades. The market has steadily climbed right over it in the past few months.

Now though, however, the markets are about to face the biggest test of all.

It’s a test that will likely determine the market’s next big move. It will signal where you’re going to need to have your money for maximum benefit. It will let us know whether the recovery is real or whether it’s the mirage we’ve expected in an otherwise desolate bear market.

The true test for this rally will be whether the market can hold on and add to its recent gains over the next few months. Here’s why.

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Gold and other precious metals spiked Thursday, as did crude oil and US stocks following a report by the Commerce Department saying the economy expanded at a 3.5 percent annualized pace in the third quarter. Gold’s rise broke a losing streak that had extended to five days. The Dow and S&P enjoyed their best one-day jumps in three months.

New York bullion figures follow:

• Silver for December delivery jumped 41.5 cents, or 2.6 percent, to $16.655 an ounce. It ranged from $16.12 to $16.71.

• Gold for December delivery advanced $16.60, or 1.6 percent, to $1,047.10 an ounce. The yellow metal ranged from $1,048.40 to $1,026.90.

• January platinum surged $31.30, or 2.4 percent, to $1,338.20 an ounce.

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Read the rest of Gold, Silver and US Stocks Rally (2,395 words)

Even though multitudes of American investors have lost faith in Wall Street and our nation’s banking system, they can still show their patriotism by purchasing American gold bullion, as they convert their wealth into precious metal diversification. Traditional investments in stocks and bonds have had their overextended course of contrived prosperity, now it’s time to pay the piper. As we all prepare for the treacheries of an indeterminate inflationary period, many investors are claiming financial independence from our banks and brokers by diversifying with American gold bullion like Engelhard brand, one-ounce, and ten-ounce bars, and American gold bullion coins like 22-karat American Eagles, or 24-karat American Buffalos.

Engelhard 24-karat bars are manufactured in New Jersey, and make great items for personal possession, as well as short-term diversifications for rare coins like $20 Lady Liberty’s, or $20 Saint Gaudens, which are traditionally used for long-term stability. Bullion prices usually hover just above the current spot price, and investors can also use this affordability for long-term financial safety, as government approved, gold-backed IRA contributions. Rare coins are not permitted for precious metal IRA storage, but the aforementioned American Eagles, and Buffalo coins are permissible, along with proof, and “Ultra-High” proof versions of the modern American Eagle bullion coin. Investors may also wish to round off their budgets with fractional denominations of the $50 American Eagle, which include ½-ounce, ¼-ounce, and 1/10-ounce coins. These investors are encouraged to complete their research, and then to contact one of our friendly specialists, who offer institutional discounts on bullion, and rare coin.

Danny Burns

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The price of gold has been on a five-day price slide, but ironically the timing of the decline was slightly off in helping collectors pay less for US Mint gold collector coins.

The US Mint uses a London Fix weekly gold average to determine whether to keep gold coin prices the same, or adjust them up or down. The average came in 28.8 cents higher than the threshold needed to cause a reduction of UHR Gold Double Eagles by $50, First Spouse Gold Coins by $25, and 2009 Gold Buffalo Proof Coins by $50.

The Buffalos go on sale Thursday at noon ET. Since the London Fix five day average is $1,050.278, the coins will launch with a price tag of $1,360.00. Had the average been at or below $1,049.99, the coin would have been released at $1,310.00.

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Read the rest of 28.8 Cents Prevents US Mint Gold Coin Price Reductions (139 words)

Gold ended slightly lower Wednesday, marking the fifth consecutive day the yellow metal has declined. Again cited as the catalyst for the loses was a rallying US dollar. Silver and platinum also fell, as did crude oil which plunged 2.6 percent. US stocks followed along, with the three major indexes tumbling between 1.2 percent and 2.7 percent.

New York precious metals figures follow:

• Silver for December delivery fell 30 cents, or 1.8 percent, to $16.240 an ounce. It ranged from $16.155 to $16.77.

• Gold for December delivery declined $4.90, or 0.5 percent, to $1,030.50 an ounce. The yellow metal ranged from $1,042.60 to $1,027.10, which is the lowest price since Oct. 6.

• January platinum ended down $12.10, or 0.9 percent, to $1,306.90 an ounce.

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Read the rest of Gold Continues Decline for Day Five, Stocks Tumble (2,367 words)

New York gold futures ended lower Tuesday for the fourth straight day as the US dollar advanced on news of a decline in consumer confidence. Silver was hit exceptionally hard for the second straight day, falling more than 3 percent. Platinum declined as well. In other markets, crude oil finished 1 percent higher and US stocks ended mixed.

New York precious metals figures follow:

• Silver for December delivery plummeted 55.5 cents, or 3.2 percent, to $16.540 an ounce. It ranged from $17.250 to $16.500.

• Gold for December delivery declined $7.40, or 0.7 percent, to $1,035.40 an ounce. The yellow metal ranged from $1,044.30 to $1,032.90, which was the lowest level since Oct. 6.

• January platinum fell $26.80, or 2.0 percent, to $1,319.00 an ounce.

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Read the rest of Gold Drops for Fourth Day, Silver Plunges, Stocks Mixed (2,493 words)

Chris Vermeulen submits:

Commodities and stocks almost look ready for a rally or at least a relief bounce. The market is down over 5% and the normal pullback this year has been 4%. Using technical analysis and inter-market analysis, we can see that the market is reaching extreme lows and this usually means we are only a couple days away from a rally.

I work with several market technicians as we all analyze the market a different way and share our work with each other to gain maximum insight on the broad market moves. We analyze momentum cycles, magnetic cycles, volatility levels, support & resistance levels, volume analysis and inter-market analysis.

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A "very significant" rerating opportunity existed for South African gold producers, Gold Fields CEO Nick Holland said on Thursday.

Holland said that the large gap that had existed between the market capitalisations of South African gold-mining stocks and those of far smaller international gold-mining companies had been closed in the past and, with proper management, could be closed again in the future.

Holland said that comparative studies had shown that companies with a fraction of the production and the reserves had equal market capitalisations.

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While financial stocks will take a back seat

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