Gold Fails To Build On Tuesday's Rally
Kitco Commentaries | Opinions, Ideas and Markets Talk
Featuring views and opinions written by market professionals, not staff journalists.
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.