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Like Magic, Gold Trades To Our Levels

Commentaries & Views

Last week gold had a blow-off to the upside, and the buyers couldn’t get enough until the rally failed. We expected failure based on the action and wrote that expectations were for a sell-off back to the $1,380-$1,390 level. In a move that Houdini would have been proud of, gold magically trades at $1,384 overnight

Understanding how markets work is as important as putting yourself in the right position to benefit from the next big move. The picture in gold was clear; support is $1,380-$1,390, and here it is trading $1,390 early this morning.

The big question from here -- is the $1,380-$1,390 level an automatic buy? The simple answer is a simple maybe. If your objective is to buy and hold, then the answer is yes you can buy it now. If your objective is to trade gold, then the answer is watch the levels and wait for the support level to hold. Either way, the key is to understand what the market is telling you and know where your exit is.

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.