Gold Commentary

Well, since mid April this is really the only downturn we've seen in a massive rally after Gold broke above 1440, that's 1440 to 1570 in a couple of weeks! I'd expect at least a 50% retracement of that Rally, which would put us right about the 1510 mark, which we're nearing now. Below that I might start getting a bit defensive and worrying about some longer term protection. Take a look at long term chart to put this down move into perspective.

Long Term Chart

The next chart really shows that Gold is not giving up ground as quickly as it gained it. That's a good sign as the markets discount quickly! What is apparent here is that the rally has been clear right from 1420. There wasn't resistance at 1500 on the way up, so the real support looks to be between 1420-1460. That would put our retracement figure below the 1500 mark! It's difficult to say, the rally seems a bit full of air with that large bubble forming in the picture below. We'll have to keep a close watch. Is it serious or is it time to buy-on-dip!