Here is a chart of Comex Gold. If you click on it you can enlarge it. The first thing to make a note of is the pullback area marked with the cursor.

This is an example of a pullback in price that was accompanied by a shift in the commercials from short to long. It is an ideal setup to go long when this occurs.

If you just take note in general of times when the commercials shift to long, a price rally generally occurs. When they shift to short, a price drop generally occurs.

Presently you can see the commercials are moving to the short side of this market, kind of like what occurred at the end of the first quarter of 2005. Notice what took play after that, a sideways to lower price move. There is a feeding frenzy in the media about this at the moment, does this remind anyone of the Naz at 5,000?

Parabolic moves like this can extend, but in general they are unsustainable. At what price a pullback occurs is anyone's guess. My view on trading is that I want to be a player when as many things as I can get line up in my favor. When they do not, I will pass. Many great traders more accomplished than I am have said, that they trade when there is an opportunity. This would not constitute a high probability opportunity in my book with the commercials sneaking out of there longs.

I will post some other charts that show parabolic moves like this, and what occurred aftwerwards. In general, this demand stuff being written about might be true. It might be true about housing. This does not mean that price will rise straight up at a 70 degree angle indefinitely. This current move is speculation.