"There are worse things that could happen than filling a gap and scattering the wrong kind of gold bugs back out. Then it would be up to the longer-term charts to do the heavy lifting if the daily does fulfill this downside potential."The gap was filled, the top end of the anticipated support zone was reached and indeed, the wrong [i.e. momentum players] kind of gold bugs are scattering back out. The hard sell down on Thursday was very likely due in large part to the selling by traders with a fetish about gold as a geopolitical or terror hedge.
We should continue to tune out these people and while we are at it, tune out the 'Indian wedding season' and 'China demand' pumpers in favor of real fundamentals like gold's relationship to commodities and the stock market, the Banking sector's relationship to the broad market, Junk Bond to Quality credit spreads and US Treasury bond yield relationships. (more)
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