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Gold: Where Are The Buyers?

Commentaries & Views

As gold continues to get hammered, there doesn’t appear to be any new money buyers willing to step in here. This morning gold traded as low as $1,236. As we wrote yesterday, the key levels are 1,235-$1,240. Failure here could lead to $1,200 and below.

The trading action has been about as ugly as it can be, basically straight down about $120 with hardly a rally. We can blame economic data, the strong dollar and about anything else, but the bottom line is the sellers are more aggressive than buyers.

Remember -- markets don’t read the economic reports; they facilitate trade. Humans and programs written by humans trade, and markets move on emotion. Gold will find a level where new money will come in but for now below $1,235, we expect a run at $1,200.

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