Monday, November 9, 2009

More on gold (charts)

As I was saying in my previous post, in this gold bull market the metal's price has tended to go up in spikes, followed by long periods of correction and consolidation. If history repeats itself once again (which I believe is the case), gold, which has just broken out of an ~18 months trading range, has recently started a new spike. At which price will it start to correct is anyone's guess (mine is about $1300, but as I said, it's just a guess). Keep in mind that I wouldn't personally start buying here because 1) who knows when the spike will end, 2) the correction is likely to bring the price back to current levels (maybe even below), and 3) the consolidation period is likely to be quite long-lasting. These are the exact same reasons why I'm not trying to trade in an out of this bull market: I'm just holding to my positions. Below are a few charts to support that (click to enlarge)


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