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Will Today's Gold Rally Hold?

Commentaries & Views

Gold and silver are attempting to rally this morning. Can they build on the rally or fail, as it seems they do every day? The first thing to look at is the pattern. The metals have been a disaster for months and every rally has failed. I don’t expect this time to be different.

As it stands now, unless you are bottom fishing or trying to catch a falling knife, expectations are that the rally will fail. Until gold can sustain a rally over $1,240 for a couple of days, we would be looking for a breakdown to $1,180.

Over the next three days are some major news events that can create big movement in the metals in either direction. On Thursday, the ECB and Super Mario will make their decision on interest rates, which could be a driver in either direction. Friday is U.S. GDP, which can also create a big move. The best trade here is patience.

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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