Quite a battle royale is being waged at the current time in the gold market. The bullion banks are digging in at and above the $1600 level while buyers are digging in just above the $1580 level where a new support level is emerging. The victory will be to whichever side refuses to blink. Open interest readings are at relatively high levels so the stakes are serious.
Yesterday we had a bearish outside reversal pattern form on the short term charts that I employ; today we had a bullish thrusting pattern on that same chart. Bulls regained the broken short term support level near $1595 that had failed yesterday but did not manage to recapture the $1600 level for any significant length of time. They will need to clear and HOLD that level to set up a challenge of the bullion bank capping level at $1610.
The new support level formed just above the $1580. This level now takes on a new significance and will need to hold on any subsequent retreat in price to prevent any further long liquidation on the part of the shorter term oriented traders.
"When misguided public opinion honors what is despicable and despises what is honorable, punishes virtue and rewards vice, encourages what is harmful and discourages what is useful, applauds falsehood and smothers truth under indifference or insult, a nation turns its back on progress and can be restored only by the terrible lessons of catastrophe." … Frederic Bastiat
Evil talks about tolerance only when it’s weak. When it gains the upper hand, its vanity always requires the destruction of the good and the innocent, because the example of good and innocent lives is an ongoing witness against it. So it always has been. So it always will be. And America has no special immunity to becoming an enemy of its own founding beliefs about human freedom, human dignity, the limited power of the state, and the sovereignty of God. – Archbishop Chaput
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