Yesterday we asked the question as whether Gold and Silver were reversing. The short-term answer is no. Although Tuesday saw a point during the day that would have reversed our positions, it did not close that way. Therefore, when trading mechanically you use the correct time for all reversals, we use end of day.

Obviously Gold and Silver are close and will reverse and go higher, just not now. Many will point to the U.S. Dollar weakness; FED intervention and ridiculous rates do not play in these markets. Those who convince themselves that they matter day to day, though they have nothing to do with price action.

We are always long-term holders of Gold and Silver; however, trading and investing are completely different. Trading news is a losing proposition always, markets are pricing in those facts regularly. Metals are many times an emotional trade, which is always a mistake.

Today we are long Platinum, Short Gold and Silver but willing to reverse when the price action suggests doing so. Until then, short is the side to be on for mechanical traders that can avoid the pitfalls of many human emotions.

Todd Horwitz Chief Strategist
Stop being a prophet and make profits

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