Gold Still No Bottom In Sight - Tactical Investor
Gold Still No Bottom In Sight

Gold Still No Bottom In Sight

 Extracted from the April 17, 2013 market update 

From a relative strength basis, treasuries are stronger than this sector, which indicates that a breakout to new highs is not going to take place anytime soon. The markets in the commodity’s sector will experience counter rallies, but in general, it is very unlikely that any of these sectors will rally to new highs until a longer-term bottom is in place; for this to occur, the respective sectors would need weekly and daily buy signals.  Market update March 31, 2013

The decline suddenly picked up intensity while we were expecting lower prices, we cannot say that we were expecting such a huge plunge to occur in one day.  This strong move down indicates that Gold could trade  well below 1300 before putting in a long term bottom.   Many will start to scream that the bull is over, but nothing will be further from the truth. Every strong bull market experiences a back breaking, and Gold is not going to be an exception to this rule.  Prices will be at least double from Gold’s eventual low. So if the low is 1200, we expect Gold to hit a minimum of 2400 before there is any chance of a calling an end to this bull. In fact, we feel that price could actually soar north of 3000.

The precious metal’s sector and key commodities will be the big news in years to come as inflation roars its head.  Though we did note not too long ago that the noise being made about inflation now was overblown and that the dollar would continue to head higher before it resumes its downward spiral and puts in a series of all time new lows.

Asians are still bullish on the gold. It looks like Indian housewives see this as a buying opportunity which means that we still have one more down leg before a bottom is in place.  Gold, therefore, could rally to 1500; former support turned into resistance before breaking down again.

Gold still no bottom in sight; aggressive traders use rallies to short the market.