I have done very well shorting the gold price over the past year, but even I have avoided the kind
of whipsaw action seen latley. Gold for the short run has become a high beta "risk on / risk off"
play. The sharp recent weakness reflects the development of a risk off trade which favors the USD
and Treasuries at the expense of the pantheon of risk on assets such as PMs, stocks, commodities
and the Euro. AS the GLD chart shows, gold is sharply oversold in the short run, and has just broken
below the 200 day m/a. The bulls and bugz are at the point of forsaking gold, something they have not done since the latter part of 2008. Gold has arrived at a key juncture and needs a sudden swing toward
risk on to give the bulls a shot. GLD
To reach a deep intermediate term oversold, GLD needs to trade below 140.
No comments:
Post a Comment