NOT A ONE WAY STREET
As much as I have bashed the GOLD Bugs here recently, I need to make it clear that my view on this as well as how I trade is not a ONE WAY STREET. We cannot afford to get so locked in to any one view on things in life. Just when we do things change. This is where the doom and gloomers are making their biggest mistake here with the metals, which I believe will be borne out this year.
However, as bearish as I am in this market, if I see things change in a way that indicates my view is wrong, I will change it. Pretty simple Aye?
Above I have the Silver and Gold Daily charts, and you can see I went long GOLD where the arrow indicates last night. As I have stated many times in here before, you always want to buy the strong and sell the weak. In terms of my techinical reasons behind this entry which are not displayed, the Silver market is a much better setup for a long than Gold. However, since as you can see on these charts side by side, Gold has been much stronger recently. As a result, I went in that market to see if there was an entry pattern by my rules, and I did find one.
Notice how Silver has made 3 lower pivot lows consecutively, whereas Gold made a higher short term low last week. This is clearly telling us there is more short term strength in Gold than Silver. This does not change my bigger picture view here at all, and I do expect a major top is forming or already has in this market. On a day to day basis I trade shorter term patterns and this as I had mentioned recently, was in a buy area for a bounce.
This also lines up with my short term view of weakness in the Dollar, that should be followed by a confirmation of a major low there. I think this will sync up with the next selling point for Gold sometime in January. As I always say, I could be wrong and that is what stops are for.