Survive The Test Of Will An Emotion
Kitco Commentaries | Opinions, Ideas and Markets Talk
Featuring views and opinions written by market professionals, not staff journalists.
On Tuesday, gold traded in a tight range between $1,262 and $1,268, closing just below the key level of $1,265. The action is mixed and consolidating as gold prepares for its next big move, which based on the information we can see would indicate a push lower in the short run and a test of the lows. A sell-off to complete the pattern would be better overall, creating more strength for the rebound rally.
Market sell-offs are only bad for those trading in the short timeframes. For investors, pullbacks are very healthy and actually provide more power once a bottom is found. Understanding the market action will benefit traders and investors because of the footprints the markets leave.
Looking into the future, the healthiest move for gold and silver would be a pullback to test the recent lows before resuming a rally. This is where traders and investors are emotionally tested. Most fail when it comes to the test of will and emotion, which is what creates the volatility in the markets.