Thursday, April 2, 2009
Gold Headed Lower; April 2, 2009
Gold decisively broke the ascending trendline after a typical test of the underside of it (see above 4 hour gold chart). As stated in earlier posts, by clearly breaking the trendline gold should freefall to $890. This level has led to huge rallies the last two tests of it but both times it's eaten away the bullish support there so the barrier for the bulls to break through is much thinner. $890 should be blasted through in the coming days which could lead to a cascade lower to the low $800s, and possibly the $600s!!
My new stop is $949, but will be ready to re-enter on weakness again. Gold will not undergo a significant bull rally until the $680 level is broken.