Gold Price: breakdown or buying opportunity?

New York (June 4)  Yesterday we wrote about the moment of truth – gold got hammered. The sell-off was hard and deep with gold down over $40 at one point. It was an ugly day; however, late in the day, there was a rally that prevented the algorithm from triggering a sell signal.

Some investors and traders panicked and dumped their holdings. The smart play was to hold and possibly add to your position. We held but didn’t add, understanding how close gold was to a reversal. Emotional or panic selling is never acceptable, which is why we always wait for the signal to turn after the close of markets. This allows cooler heads to prevail.

Silver and platinum were also weak on Wednesday, however, nowhere near how weak gold was. Silver remains the strongest of the group. Gold and platinum are still in danger but managed to hold key support. Before we add to our positions, we will be watching for the next couple of days. We remain long gold, silver and platinum.

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