Issue #87
Dear Member,
Though gold managed to close above some important resistance on Friday, silver did not confirm the action. Thus we have what I call “a fractured market” or put another way, there’s no cigar indicating a further rally in the metals and a cycle inversion.
Obviously, with the bearish positions you have now on, that’s important. And yes, it is good news. Though your positions are underwater, there is still a very high possibility that gold and silver will plummet this month.
I am watching the intraday action in the metals like a hawk right now. So far, on the hourly charts, I have sell signals in both gold and silver.
What we need to see is downside follow through. If gold can trade back down to the $1,226.70 level and close below that either today or tomorrow, we should be on the way to much lower lows later this month.
As tough as it is, hold all positions and related protective stops. If we get confirmation that the bounce is over by gold closing below $1,226.70, I would expect that a sharp collapse lies ahead for the metals. I would then get even more aggressive on the downside and recommend you add back the inverse silver ETF (ZSL) which you were stopped out of last week.
Stay tuned and best wishes,
Larry
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