Chart Analysis: Tanzanian Royalty Exploration (TRX)

Let’s start by reviewing the period between April 2006 to January 2010.  This is when several levels of long-term importance were established.  Given the high at around $9 and the low at around $1.50, the fibonacci levels now influencing the share price are established.  Additionally, an up-trend was established, as indicated by the trend line from the dips in October 2008 and September 2009; this up-trend has remained in tact and serves as long-term support.

Here is a long-term chart for October 2006 to August 2011 showing the long-term up-trend with trend support at $5 and various reactions around key fibinacci support levels at 61.2% and 78.6%.

Here is the long-term chart for September 2008 to August 2011 showing the long-term up-trend with long-term trend support at $5.

Medium-term chart for October 2010 to August 2011, indicating a short-term range trade between long-term fibonacci levels 60.8% and 78.6% descending wedge with trend support at $5.

Short-term chart for March 2011 to August 2011, indicating a descending wedge formation nearing completion.

UPDATE: 9/2/2011

It looks like we have a short-term down-trend-line breakout on the 1-year chart in TRX.

TRX 9/2/2011 - 1 Year Chart - Tanzanian Royalty Exploration Corporation
TRX 9/2/2011 - 1 Year Chart - Tanzanian Royalty Exploration Corporation

Martin A. Armstrong on the S&P Ratings Downgrade of the USA

The following is a question asked to Martin Armstrong, author of the Pi Cycle Economic Confidence Model and former chairman of Princeton Economics International. Martin Armstrong is a bona-fide economic genius with a number of amazing predictions having come true to date. His words are definitely worth considering in your own planning.

Will a Downgrade of USA FROM AAA Really Mean Anything?

source: armstrong.org

The hype about Standard & Poor going to downgrade USA credit rating is just not important. Oh the
talking heads will cry the sky is falling. They downgraded Japan in 2002 and nothing took place. Not even their rates increased. The same is likely in the USA and quite frankly, if S&P really thinks they have that much power, they should stop drinking their own bath water.

Downgrades come AFTER the market has already shown its course of action. It is not like the rating agencies actually pontificate and then the markets wake up and say: Oh my God! Ratings follow the market activity and have no power otherwise. The credit rating they gave the CDOs did not convince people to buy them. Once the junk was rated AAA, they were good collateral for the REPO market. That was the key. They rated the junk AAA and that made it good collateral and that was the ONLY reason the stuff sold. Without that rating, the NY boys couldn’t sell anything.

When it comes to sovereign debt of the USA, we are talking about the US$ is the RESERVE currency. About two-thirds of central bank reserves globally is in dollars and the way those dollars are held is in government treasuries. Does anyone really think that if S&P downgrades the USA that its debt will not be sold?

When you deal in REAL money, there is a problem. How do you store it? You can’t just put a billion on deposit at a bank. They will sell it every night and don’t have to tell you. If the REPO market blows up and you go to the bank and say I want my billion, they lost it, and so you turn to FDIC to collect your $100,000. Right! The ONLY way to park serious money is in treasuries. If you have hundreds of billions, now you have the added problem of MARKET SIZE. You can’t just go to any country. Their debt structure cannot provide the ability to park serious money. This is the difference from taking personal economics and applying it to the whole world. It doesn’t work! Don’t worry. Be happy! Until we revise the world monetary system and the dollar is no longer the RESERVE currency, sorry boys, but you are spinning scenarios that scare people, sound good as talking points, but are just gibberish in the real world of serious money. Rates will rise because capital will shift out of bonds into assets not because of the S&P.