Monday, April 6, 2009
Gold Falling as Forecasted, More to Go; April 06, 2009
Of all the trades I've been tracking, gold has been a cash cow and has followed my exact forecast. First, the ascending trendline was broken which I said would lead to an immediate charge and test of $890. I said this level has been formidible in the past, but shouldn't put up much of a fight now because it's been tested so many times that the bullish defenses should be severely eroded by now and the metal should break through the level convincingly. Well it broke through $890 last night and into today convincingly alright as you can see from the daily futures chart above. Now the bulls may push the metal back up to the $890 level to try and bust back through it, but it's not required, and it should be a failed attempt. Once that happens, the bulls should just give up and send this metal down hard........and fast! However, this may not even happen and the metal may just continue lower from here. My initial target to start taking profits is the $830 area, but I'm mindful the metal may make it to the $600s so I'm more interested in dropping my stop losses and letting the market take me out so I don't miss a big move in case it happens.
The metal is bearish and should be headed lower to at least the $830 level in the coming days.