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Here is what top Citi analyst Fitzpatrick had to say, along with powerful charts:  “Overall, the price action that we are looking at in silver is very constructive.  In recent weeks we had a down-move which took us just below the 55-week moving average.  But we came off those lows very nicely with a weekly reversal on the week of the 5th of November.

“We now have two levels we are watching.  The first zone is $35 to $35.70.  This marks the highs from October of last year and so far this year.  Above those zones, the most important area still remains the $37.50 level we saw in February.  We still believe this is a triangle formation that we’ve broken out of, with a double-bottom within it.

The neckline of this formation is at $37.50.....

Continue reading the Tom Fitzpatrick interview below...


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“When silver eventually punches through $37.50, it will suggest to us that we have totally broken out and started an up-move that is going to take us back to retest the old all-time highs set in 1980, and similar highs that were set back in April of 2011.”

Fitzpatrick had this to say regarding gold:  “We got a big move down yesterday.  At the end of the day we’ve seen an element of short-term choppiness in gold, but the overall medium-term trend has remained very much intact.  We had the move down on gold a couple of weeks ago to the 55-week moving average, and then we had the bullish weekly reversal coming off of that.  So the action in gold looks very constructive to us.

We still believe gold needs to break the pivotal level near the $1,792 area.  When we do get a weekly close above that level, this really will give the breakout we’ve looking for which opens up the way for the first leg of the next up-move.  That first pulse will take gold to $2,060, and then on to $2,400.

Fitzpatrick also added: “A lot of people have tended to view gold within the prism of a dollar trade, whereas we view gold within a hard currency vs paper currency trade.  As we continue to see money moving back and forth within the developed countries currencies, which are all engaged in quantitative easing, it is just fine tuning for us in terms of which currency is better to short against gold.

For us, long gold against all paper currencies is still the core trade and we believe the overall price action remains very solid.  The longer the breakout in gold takes to materialize,  the quicker the move will most likely be when we actually get that break.

When you look at the move off the recent lows, which is comparable to the basing price action we are seeing now, when the breakout took place we saw a $200 move in just one month.   Whether we see this move take place in December or January, the outcome will be a significant move higher as $1,792 falls.”

© 2012 by King World News®. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.  However, linking directly to the blog page is permitted and encouraged.

The interviews with Stephen Leeb, James Turk, Egon von Greyerz, Michael Pento, Wilbur Ross, Don Coxe (BMO $538 billion) and Ben Davies are available now.  Also, be sure to listen to other recent KWN interviews which included Art Cashin (UBS $612 billion), Nigel Farage, and Bill Fleckenstein by CLICKING HERE.

Eric King

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