Today's weather: gold stormy while silver and platinum calm
New York (May 27) Gold has become like a weather report – unpredictable and the timing is almost impossible. The last few weeks have been very stormy for gold. Although the long-term trend remains up, the short-term action has been negative. The pattern itself has been like a thunderstorm; all looks good and clear, bang, in comes the seller or thunderstorm and down it goes.
Gold has been in a wide consolidation pattern with about an $80 range. Volume has been fair and liquidity noticeably light. As of this morning, gold is at a decision point. Either the bull market continues, or the sellers will take over. For now, we remain long but know the storm could come and reverse the pattern. We will hold but will not add at these levels.
Silver and platinum have been bullish and moving higher. The last couple of days have been a little stormy in platinum and silver with the pressure starting to mount. The threat of a reversal in platinum and silver is real but they are both stronger than gold. We are long all three and will stay there at least until tomorrow; if the selling picks up, it will probably create a reversal signal. We will watch the price action before making a rash decision. In the meantime, we will be carrying our umbrella.
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