Precious Metals Market Timing
Will Gold and Gold Shares Rise or Fall in the Near Term?

Ron Rosen
Aug 24, 2005

There is much being written about the imminent rise in the price of gold and gold shares. There are numerous reasons why I believe there is more corrective action ahead before gold and the gold shares rally and the next more powerful second phase starts. Four of the most important reasons are;

1. Delta turning points
2. Thirty year Gann Master Cycles
3. The Quarterly gold chart
4. Monthly wave count

I have discussed these four items in previous reports and will continue to keep you updated on their progress. In addition we have an alternate plan for reentering the market in the event a clear and undeniable move up takes place. We need evidence that the bottom is in place and the next bullish phase has started. Without the evidence we are guessing that the bottom is in. From what I read a lot of folks have been guessing for about two years. That is not satisfactory for us. I would rather pay the insurance premium of higher prices and know that the move has started. The next phase, if history is any indication, will be substantially greater than the last phase. The "insurance premium" will help us avoid further sideways and downward action of both the bullion and the shares. If we are sufficiently patient we may enter close to a genuine bottom. It's either near the bottom or hop aboard after the train has started to move in the right direction. Either way we are keeping our check books and money "holstered" until we hear and or see the starting gun. I don't hear it or see it just yet. If it surprises us our plan of entry will get us aboard using a proven and successful method. So, we wait.

This is the chart that, when the clearly defined more than 20 year trend line is breached, will cause a greater than volcanic eruption in price and attract a vast amount of buying. It will most likely drag the entire precious metals complex with it. If the shares perform their usual job of rising before the metal we will have an early warning sign. I mean rising on huge volume where blocks of hundreds of thousands of shares are printed on the tape and an occasional million share trade takes place. It will be mayhem in the gold pits but we are not there yet and we must be patient. It appears that the much ridiculed W.D.Gann observation that years ending in the number 5 are up years for the stock market may be keeping the stock market from declining. 2006 may not be so fortunate for the stock market. We have a Delta Long Term low in gold due between Sept 2005 and July 2006.

The pattern and formation in the gold charts 30 years apart are remarkably similar. There is a Delta medium term # 5 low due in October and long term # 4 low due in February 2006. If long term # 4 decides to arrive with medium # 5 low there could be a vicious drop. However that would be the end of this two year correction.

Ron Rosen

email: rrosen5@tampabay.rr.com

Tee charts reproduced courtesy of The Delta Society International.

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