Today we saw a "drop" of $5. Of course that's all it takes for the bears to flood TV with their sub 1200 predictions (they'd probably just be happy to close their current underwater positions at BE).
One of the main issues people are having, is that they think this rally is solely due to the tensions with North Korea. As we've all seen with political tensions like this, every gold spike is given back. These "events" do not ever lead to held gains. To anyone who wasn't blind, you could clearly see there was a lot of momentum building under gold, and it was only a matter of time before we breached above the 1300 level. This was a very obvious trade, as long as you didn't have a predetermined bias.
If this was purely a safe-haven trade, then we would have seen a stock market decline, and we would have seen heavy buying in the yen. If you take a look at the USDJPY, we did not make a new low in this currency pairing, yet we made a significant new high on the year in gold. That alone should tell you this run was not due the "NK scare".
The USD, along with fiat currencies in general, are dying. With China banning ICO's, the country will turn to gold as an alternative to fiat currency. This baby gold bull during 2017 is due to people wanting to get out of fiat currencies (especially the USD), not because NK is doing what it's always done.
With that being said, there are always small corrections during bull runs, and this bull run won't be an exception. IF we are to drop, and that is an IF, the two main buying zones will be the blue boxes on my chart. (1318-1322, and 1303-1307)
GL to both sides of this trade.
One of the main issues people are having, is that they think this rally is solely due to the tensions with North Korea. As we've all seen with political tensions like this, every gold spike is given back. These "events" do not ever lead to held gains. To anyone who wasn't blind, you could clearly see there was a lot of momentum building under gold, and it was only a matter of time before we breached above the 1300 level. This was a very obvious trade, as long as you didn't have a predetermined bias.
If this was purely a safe-haven trade, then we would have seen a stock market decline, and we would have seen heavy buying in the yen. If you take a look at the USDJPY, we did not make a new low in this currency pairing, yet we made a significant new high on the year in gold. That alone should tell you this run was not due the "NK scare".
The USD, along with fiat currencies in general, are dying. With China banning ICO's, the country will turn to gold as an alternative to fiat currency. This baby gold bull during 2017 is due to people wanting to get out of fiat currencies (especially the USD), not because NK is doing what it's always done.
With that being said, there are always small corrections during bull runs, and this bull run won't be an exception. IF we are to drop, and that is an IF, the two main buying zones will be the blue boxes on my chart. (1318-1322, and 1303-1307)
GL to both sides of this trade.
Comment:
Will re-chart and publish a new idea after work today.
Wednesday will be volatile, but we won't have a sustained move 1300.
This is very much a healthy bull, and consolidating above 1300 is a great sign.