Let's look at gold, a chart that is becoming increasingly bearish. Head and Shoulder pattern has neckline around 460. Another close below that and gold is headed straight for 440 area, 100% projection head/neckline. Add the 50 dma at 463.50, and gold bulls better show their stuff now or risk losing key support. Inflation is under control, a little too much so if you ask me, but that is what the feds do: they always go overboard. The dollar is rallying and seasonal demand for gold might not be as strong as the economy slows. It all adds up to a corrective period for the yellow metal. The hope for gold bulls lies in a collapse of the dollar, which is a very distinct possibility, but don't bet on it too much.
This entry was posted
on Wednesday, November 02, 2005 at 4:43 PM.
