The Gold Bugs want to know if the bottoms are in; of course they never think the yellow metal goes down. The answer is not an easy one, based on the chart and price action the simple answer is no. Last week’s action from the FED announcement was solid but not enough to reverse the downtrend.

Silver looks very similar to Gold while Platinum continues to struggle. The FED news was not bullish for the metals, however we must understand that the news may have already been priced in leaving a short covering rally. This week could go a long way determining if the bottoms are in, but it is a short holiday week and the action could be thin.

There is a key level that is much lower at 1450 that could come into play. However, we don’t make calls like that; it is simply a chart point. As we look in the real world near term, 1760 and then 1720 are the key levels on the downside for Gold. 1820 would be a level that a reversal could take place.

We remain short and would consider selling more except for the holiday shortened week. Obviously, we could be wrong and forced to reverse. That is trading and our win percentage is 66%. The pattern the signal and the action suggest Gold is headed lower.

In all markets price action determines what will happen in the next day, week, or months. Keep the two strategies separate, the worst trade anyone can make is turning a trade into an investment hoping for a way out. Traders must learn to take their losses and move on to the next trade.

Patience, discipline, and money management always win the day. Let the map of the markets show you the way.

Todd Horwitz Chief Strategist
Stop being a prophet and make profits

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