Thursday, February 9, 2012

Gold Continuing to Fail at $1750

Gold has now spiked through the $1750 level several times since the end of last month but has not been able to CLOSE THROUGH this level. Until it does, the market will not be able to start a new leg higher in the uptrend.

Generally speaking, markets tend to pause at resistance levels until they can gather enough of a spark to take them strongly through those or they retreat and consolidate leading to some basing action. During the latter, some of the shorter term oriented bulls will liquidate longs out of frustration or out of a desire to cash in some profits and bank them. That selling then paves the way for some opportunistic short selling to emerge.

We had a combination of both today leading to a pull back in price. Support on the downside remains near $1725 - $1720 with stronger support down closer to $1710 - $1705.

Silver needs to get above $34 and stay there to allow it a chance to test major resistance near $35.00 - $35.25.

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10 comments:

  1. AnonymousFebruary 9, 2012 at 4:01 PM

    Dan,
    Gold CIT today
    The Next SPX CIT Approaches
    http://markethighsandlows.wordpress.com/

    ReplyDelete
  2. willydogFebruary 9, 2012 at 4:11 PM

    Pressure is building on the long side for sure. Cartel is holding it down and shooting their load, getting caught on the wrong side of the trade. If volume picks up, they are going to be forced to run for higher ground.

    My thinking is that specs have been giving serious thought to re-joining the party, and the margin cut is going to be wildly bullish for the action tommorrow and into next week. Especially with ES stagnating. Easy money has been made in equities. I see all major resistance levels falling shortly on the PM's. The margin cut is the gift the bulls have been waiting for. Crimex volume picked up a little today before the beatdown.

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  3. RayboFebruary 9, 2012 at 6:46 PM

    How many time do we test $1750 before we get a large correction?

    ReplyDelete
  4. PhilFebruary 9, 2012 at 10:15 PM

    This comment has been removed by the author.

    ReplyDelete
  5. White WolfFebruary 10, 2012 at 5:53 AM

    Two articles showing the pathetic continuance of Vaporization!! I believe gold in short term going to hit alot of turbulence. Maybe next year gold stocks will skyrocket???? Is it not just grand how Obama and his cronies destroy capital markets...

    http://af.reuters.com/article/commoditiesNews/idAFL2E8D9IKR20120209?pageNumber=4&virtualBrandChannel=0

    http://barnhardt.biz/

    ReplyDelete
  6. White WolfFebruary 10, 2012 at 6:03 AM

    Dan, don't you think that the place to be in the near term is oil? Once they start printing gold and oil. Seems to me the floor is established, with a place to launch?


    http://www.zerohedge.com/news/china-january-oil-imports-rise-record

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  7. boatmanFebruary 10, 2012 at 6:23 AM

    Mish says germany constantly raising the bar for greek bailout. n that they know they will fail anyway so let them leave on their own it'll look better.

    makes sense....if greece leaves BEFORE march referndums in EU on DEC accord then it might pass.

    so thats deflationary/risk off in short run and inflationary/risk on in the long

    ReplyDelete
  8. White WolfFebruary 10, 2012 at 3:58 PM

    I agree totally, if Greece leaves positive for EUR/DXY. But,, unitl then they will beat this drum hard. I am waiting for mid March to buy into metal stocks.. Sorry, but the song remains the same. Oil on the other hand has a floor. The powers that be cannot control it. They want to but they cannot.. I love it..

    good luck all. Dan is great. He needs to post some more oil charts...Love everyone

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  9. White WolfFebruary 10, 2012 at 4:02 PM

    Also, if I could I would bet my IRA on the Food chain, however, they, pwers to be do not allow it..i might take everything off the table and pay tax now, but not yet,,Dan,let me know if you hear of anything perplexing soon

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  10. willydogFebruary 10, 2012 at 5:50 PM

    @boatman, Germany only has so much political cover to raise the bar. The offer is out there, they can't pull it back. If Greece agrees to all the troika demands, it's going to be very hard for them to not give the bailout money. Beside, what's a couple hundred more billion Euro's between friends when they've already printed up $2T fresh Euros, with another $1T on deck.

    I think the cartel is trying to beat it down before the next LTRO (LMFAO), to start a new bear/bull cycle by then. Wait until the jaw dropping headline of $1T plus of fresh Euros, and this time there is no doubt about that money being shoveled back into the system. Parked at the ECB. LOL

    ReplyDelete

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