Gold testing 1800, looks like a selling opportunity
Kitco Commentaries | Opinions, Ideas and Markets Talk
Featuring views and opinions written by market professionals, not staff journalists.
As we approach the end of the year, gold, silver, and platinum have work to do on the downside. The dramatic drop last Friday, Monday and Tuesday did a lot of technical damage to the charts. Gold broke down from congestion and is now below $1,800 based on March futures.
The next support level for gold is $1,750; if that fails, $1,700 is in play. If you have watched markets for any period of time, everything is based on probability and the most money is made trading with the trend. The break from congestion was a possibility even though the trend at the time was higher.
Here we go again. The gold bugs will be out touting how high gold is going. As we have written in the past, there is no doubt Gold, Silver and Platinum will be higher in the future. However, for now, and today the trend is lower and rallies should be sold.
You must recognize if you are making a trade or an investment. The big problem is most can’t identify who they are in the trading/investing world. As we have witnessed recently, people tend to sell their strong holdings while holding onto the garbage. Although we are big fans of physical metals and will always be a buyer, the trends are lower and should be sold.
One of the hardest thing investors/traders must deal with is taking a loss. As stated many times, proper investments shouldn’t be sold and should not be overextended in monies used. Traders using level must take losses when they come without fail.
Until the trend changes, gold, silver and platinum are headed south, a great opportunity exists for those who can separate opinion from fact. Too many are so opinionated they can’t see the trend through their opinions. We are short and will be until the trend changes; it’s that simple.
In all markets, price action determines what will happen in the next day, week, or month. Keep the two strategies separate. The worst trade anyone can make is turning a trade into an investment hoping for a way out. Traders must learn to take their losses and move on to the next trade.
Patience, discipline, and money management always win the day. Let the map of the markets show you the way.
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