A lot of talk this weekend of gold going over $1000.00 and silver over $20.00, in 2008. Only time will tell drill it and they will come griz A Merrier Christmas Ahead for Gold Bugs or Greenback Bulls? - Sector-Wide TA

By Roy Martens Dec 5 2007 11:39AM www.resourcefortunes.com

The end of the year is almost here and up until now it was a very strange one as far as precious metals and their accompanying stocks were concerned.

The strange part is that while Gold and Silver have moved along quite nicely, mining stocks, especially the juniors, have had a rough year. There where gains followed by huge losses, with some of the junior stocks losing 50% of their value or more all while their fundamentals haven’t changed very much at all. Even stocks that made big discoveries suffered after an initial gain. If we compare prices of a number of these junior stocks from the beginning of this year with the current price of Gold and Silver, we can clearly see that the stocks are lagging, and by quite a bit in most cases.

This cannot stay this way for long, so there are 2 possibilities:

• The price of Gold and Silver will correct, or
• The stocks will make up for their lost ground with significant rallies over the coming months.

Because I don’t think we will see a breakdown in the price of Gold and Silver (besides the 'normal' corrections along the way), this means that the juniors are in for a catch up rally sooner or later.

Maybe the current pressure can be blamed on the overall sentiment in the equities market. The international indexes have suffered a great deal lately and seem to be on the verge of a collapse. However, when things seem to be this obvious, they usually don’t happen. The overall negative sentiment is the right environment for a relief rally in the indexes that could last for days, weeks, or even months. This could prove to be a great opportunity for those that missed the exit the first time.

This last month of the year should be very interesting to watch. Will Gold, Silver, and Oil end the year with a bang or will we see a correction before we will see higher prices in 2008. The charts for the three are a bit clouded, and they could go either way this last month. Let’s hope they are prepared to give us a good Christmas.