Taking a quick look at the above chart we can see that gold prices appear to be stuck in a trading range for now and may continue to trade sideways until we get some sort of resolution to the European Fiasco. The long term trend is still up so we must learn to expect these knocks along the way. Shortly after gold had risen above the $600/oz level (many moons ago) we wrote that you would never see $600/oz gold again and the detractors fired in the brick bats accordingly, well it wont be too long before $1100/oz is history too.
Here we are at much higher levels and the doubters still abound in abundance. None us know for sure where gold will take us in the short term but we are however confident that gold prices are headed higher and will finish the year at higher levels than they are today.
The question of which vehicle will give us the biggest bang for our investment dollar will remain with us and we will continue to wrestle with it and try alternatives, but there is no substitute for having the real deal in your own hands. We see it as not just an insurance but also as an investment that is as good as, if not better, than any other investment available today.
Back to the chart, please note that the 200dma is still rising and closing the gap between with gold prices which will support gold prices and we see it as being very positive for gold.
The USD has bounced and we note the inverse reaction by both silver and the HUI which have turned down sharply. Various programmed 'stops' have been triggered by the fall in gold prices which added to the selling pressure on Friday, however, by the end of the trading session gold prices were stabilizing.
Well fast forwarding to today all eyes will be focused on President Obama's health care reform bill and how the market reacts to it. We understand that there are last minute changes being undertaken such as abortions will not be allowed on the state, but we will need to see the final draft, if and when it is passed.
Also look out for Thursday, when the European Union meet as we may get some indication as to just what they propose to do about the Greek problem.
Have a good one.
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