Gold Rally, Real or False
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Once again, on Thursday, gold had a dead cat bounce higher; after starting the day down early, the precious metal managed a nice rally. However, the real question investors have to ask: was that a real rally with legs or just another selling opportunity?
As we wrote yesterday and asked why wasn’t gold much higher when the equities were getting slammed? The answer is simple, gold is in a downtrend and Thursday’s rally is nothing more than another selling opportunity.
There is no doubt that at some point, gold and silver will rally again and start to move higher, but the current conditions suggest that rallies should be sold. Until something changes, we are targeting 1240 as the next key level and Thursday was just another opportunity to sell. For now, we are not buyers until gold can trade over 1300 and hold.