We told you last week to wait for better prices if you’re planning on buying gold bullion. That is still the case, although it looks like it may not be long before the promised bargains arrive.  A week ago, with Comex August Gold trading for around 824, we projected a minimum downside target of 899; yesterday the futures settled at 924.60 after making a two-week  low at 920.30 . Lest you get the impression that gold sat still in the interim, we should mention that buyers goosed it as high as 947 last Wednesday. The rally looked like a fake, though, and we warned subscribers not to chase it. But the current bout of selling looks more convincing, and that is why we are telling you to wait for lower prices before doing any serious accumulating.

How far might gold conceivably fall over the next few weeks? As far as boredom dares to push it, we’d guess. However, we see no real urgency in the selling right now, only a tendency by some investors to lighten up out of impatience. Nor is it gold’s recalcitrance per se has tested investors’ patience; rather, many have grown bored with the bear rally in stocks that has temporarily sucked the life from the precious metals sector. For, as long as stocks remain buoyant, it will tend to distract investors from the gathering financial storm that seems destined to push precious-metal quotes to new all-time highs. For your information, and no matter how bored investors become, we doubt that August gold could go much lower than 882 over the near term. And even if it did, the long-term charts would remain a picture of health all the way down to 810.

 Silver More Vulnerable

Silver looks somewhat more vulnerable, at least in percentage terms. The September contract settled yesterday ay 13.275, but a test of early Spring’s lows near $12 appears all but inevitable over the near term. If this is correct, the retracement from these levels would amount to a tad less than 10 percent. Because we never like to chisel these forecasts in stone, here are bullish trigger numbers, first for September Silver: 14.425; and then for August Gold: 966.80.  If either of those number were to be hit before the downside targets given above, all bearish bets would be off. 

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 Expanding Our Gold Commentary

Beginning Thursday, Rick’s Picks expands its coverage of the gold world with weekly contributions from Chuck Cohen, a seasoned investor and consultant who knows the mining world as well as anyone we know. In his initial offering, a three-part series, Chuck will explain why he thinks gold is about to embark on the most spectacular bull market of them all. He will also try to shed some light on why most investors fail in their objectives, and why they are oblivious to gold’s volcanic potential on the eve of its eruption. In future columns, Chuck will get down to details, picking the mining stocks he believes will offer the most powerful leverage once the bull market shifts into high gear. To ensure that you don’t miss out on Chuck’s debut later this week, and to have Rick’s Picks commentary delivered free each day to your e-mail box, click here.