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Gold Fails To Build On Tuesday's Rally

Commentaries & Views

Editor's Note: Gold and silver has been, at best, a frustrating trade. Exclusive to Kitco News, expert trader, Todd "Bubba" Horwitz, chief market strategist and founder of 'Bubba Trading provides a strategy investors can use in a range-bound gold price environment. Sign up before March 10 for the Kitco News Weekly Rundown newsletter to receive Horwitz's exclusive report and trading strategy.

Gold failed to follow through on Tuesday’s big rally, at the same time making a lower high, indicating that there is more room on the downside. The resignation of White House economic adviser Gary Cohn helped gold rally on Tuesday night, but the metal has sold off since.

After making a double top in mid-February, gold has worked its way lower and is poised to test the $1,300 support level. News that should drive the price of gold higher has not done so, which is just another indication of the underlying struggles.

The suppression of the dollar by the Fed and central banks around the world should be buoying the price of gold but it’s not. Our view is the dollar is about to break out to the upside, which will add more pressure to an already weak metals market.

We are long-term gold bulls but have too many concerns at the levels that both gold and silver are trading. This is a time to observe the markets and wait for clues on direction. Let the bulls and bears battle in this congestion range, which is filled with uncertainty.

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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