"Jim also mentioned other lesser factors, such as, the gold market may be down or going nowhere at that particular time of the PFS's release, or the PFS could be released during the Summer months when people don't pay much attention."

IF we have a summer rally in gold this year, which I suspect we will, odds are pretty good people will take notice of the PFS in spite of its being summertime. But will they keep that conviction? Will we keep that conviction?

We are quite close IMO to an explosive period in the price of gold. I think we go up to the 1300 area. Have a brief but significant correction, then exceed 1300 in a near vertical rise to near 1450. That will complete wave one of III.

The wave two of III will be a serious correction. It will be (.23), (.38), or possibly even (.50) of the entire run-up to the eventual top of wave one of III from 680.

Let's flesh that out a bit so we can appreciate the magnitude of the correction which may occur. Let's say we have our intermediate top near 1300 fulfilling the huge inverse H&S pattern everyone has seen. Then the brief but significant correction occurs (no estimates). Then the vertical rise begins to complete wave I; it perhaps runs to 1450.

1450 - 680 = 770 (the hypothetical entire run)

770 X .23 = 177

770 X .38 = 293

770 X .50 = 385

The serious correction then takes us back to (.23*) 1273 or (.388) 1157 or (.50*) 1065.

Wave 1 corrections tend to be more severe so the 1157 or even 1065 are likelier IMO than the correction to 1273. (Of course all these numbers are just fibonacci projections.)

Add to that the fact that many will have turned their attention to gold by that time and new ones will be in the market. What a perfect opportunity for those who love to profit from gold on the short side to engineer a fibonacci 50% slaughter and exit from their short positions (they will be long gold when its rise is unstoppable).

When all the newbies have sworn off gold for all eternity and many old hands will have been shocked to the point of loosening their grip on their positions, that will be the turning point in the market just like the huge correction in gold from 1974 - 76.

From there on the market goes vertical in a huge, violent trend that never ceases and never allows anyone to feel comfortable getting in. Those getting in on the beginning of that run will only be experts or financially saavy people. The newbies will have been pushed out. The weaker hands that sold will no have the courage to get back in at a loss to their previous position in such a volatile market. By the time they come to their senses it will be too late.

Once it starts, the very unending rise in the market (like the dotcom bubble) will draw in the public and the price of gold may go up as much as $100 or $ 200 per ounce a day.

Are you mentally prepared for this? Or are you watching the tick by tick price of the stock and setting yourself up for a fall when this really gets going?

Well, that's my story; and I'm stickin' with it.

P.