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Gold Rush Or Dead-Cat Bounce?

Commentaries & Views

Gold and equities are spiking higher this morning, with the Dow up over 300 points, continuing Friday’s late-day rally. Gold, after being up more than $15 overnight, has slowly grinded lower and now is up $5.

The big question is whether this is a dead cat-bounce in markets that are going lower or are the bottoms. We look at this as a dead-cat bounce and a natural rally after a heavy sell-off. Both gold and the equities appeared to have peaked and what we are seeing is a bounce within markets that are headed lower.

The volume and volatility are indications that the tops of the markets are in and these vicious sharp rallies are bounces that should be sold. Gold should fail around $1,330 and bounce from $1,300, while the equities should fail here and make a lower low before the week is over.

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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