Many people have written into us recently asking our views on gold and silver. The recent price action -- particularly of gold -- certainly has been impressive. A long dormant bottom is slowly rumbling back into activity.

But we cannot advise that just under $350 gold is a compelling buy. It's still cheap longer term, but this metal is now right into the first of two short-term technical resistance zones that we spy on a Fibonacci basis (the first being near $351 and the second up at $371). So just call us agnostic at best. Ditto euro fx which has now reached and slightly exceeded our previously espoused Fibonacci target just above 1.04. Don't try shorting either of these markets, but do take profits, and move to being flat.

But we do like to start a new year with at least one strong prognostication, so here is one: the weekly copper chart depicted below is destined for new lows. These may come down near 54 cents or even 49 cents, but they will come sometime in 2003 -- most likely by mid-year. And copper is of course a traditional indicator of economic strength or weakness, particularly in the housing sector where so much of this metal is used. Just think about it logically: In the past two years we've made it through a huge building boom and the price of copper has barely been able to rally. But that home building boom is in the process of petering out, and as it does, we smell a 4th wave period of chop in copper finally leading to 5th wave decline.

Chart constructed using Advanced GET End-0f-Day

Long-time readers of these pages will remember past advice on a potential commodity spread position: We liked being long gold particularly on spread to a short position in copper. At the current time, let's amend that view to simply being flat gold, but as bearish as ever on the copper market.