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Gold Is Back Or Dead-Cat Bounce

Commentaries & Views

On Wednesday, the Fed did the usual -- nothing and no surprise -- which helped push gold up $12. The rally continues this morning. Gold has a high of $1,261. Silver rallied 40 cents and the party was on and is continuing this morning. Are the metals back in rally mode or is this a dead-cat bounce and a selling opportunity?

There is no way to know with 100% certainty but based on the previous footprint, we would consider this a dead-cat bounce for now and look to be sellers around $1,270 in gold and $16.30 in silver. The metals have been under so much pressure that a bounce was coming along with a short squeeze.

Bitcoin has been under a little pressure on the new CBOE contract and volume has dried up a little, indicating that some of the money that left the metals came back. However, gold and silver have work to do before we are believers in this rally. Observe with patience and let the charts do the talking.

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.