Gold has been under pressure since early January and is approaching the November lows. However, like all markets we don’t expect Gold to go straight down without attempts to reverse direction. This is usually profit taking or a short squeeze. The heavy selling this week should see a bounce back to 1800 April Gold.
When trading price action the phases of the markets will show when levels exhaust themselves, allowing to take pressure off before the current trend resumes. The current downtrend has been in place since mid-January in Gold and should continue taking Gold to the next levels of support of 1750 and then 1700.
While Gold has been in a solid downtrend, Platinum has been charging higher making 7-year highs. Silver reversed Tuesday February 9th. While Gold looks weak, Silver and Platinum look strong. The Gold Silver ratio continues to collapse which is just another indication of the overall trend.
Remember, this blog is about trading not investing. I have no doubt that all metals will be much higher some day and we will continue to accumulate physical metals. However as traders we are short and will stay short until the trend changes. Do not confuse what you are trying to accomplish.