Since there are 4-weeks left in the uptrend and this current decline looks to be just a correction within the uptrend, I think it makes sense to re-enter long here at 1234 and look for 1300 again in the next 4 weeks.
Risk is approximately $20-$40. Upside is $60-$80. You decide how much to risk. I'll say Risk $40 to make $60, but that is being conservative.
Reason for correction? Market isn't rallying Money Creation. US Growth, jobs, , etc, have come in a bit better than expectations which is notching up strength in interest rate forecasts going further into the future. However, I think this is just a correction from SEVERELY overbought. Silver , by contrast, hadn't reached its target, and I'll make another chart about silver next.
1:58PM Friday, February 6, 2015
Although yes, we could potentially see that 1190 level first, as Tim pointed out, this is a great long term time to buy in, just set your stop. Technically, if you go back to 2005, we have a nice bullish flag/pennant pattern in the works. The USD is putting a lot of pressure on Gold but Tm mentions the bubble bond and who knows how much longer equities will remain attractive.