Gold Prices Ready to Move, - but Whereto?

Just a quick one today, or 'two' I should say.

There are still a few tickets for Tuesday, 11 January 2011, at the HDB Hub, where we will present our outlook and strategies for 2011.  If you can come, drop me a line quickly so I can reserve your seat. If you order through me, it's a complimentary ticket, - otherwise it's $30.00 at the door.

Gold prices have touched on the 1360 level, which denotes crucial support. If prices now close below 1360 in the next few trading days then we can safely assume that gold is ready to correct down to about 1295, the level I expect to reach sometime in February. 

If this happens, we will go ahead and execute the proposed changes as outlined to our investors last week, - and then wait and see what the rest of the market does: If gold does indeed correct now, then the envisaged weakness in currencies this month becomes a non-event.  It might also suggest that bond prices (treasuries and sovereigns) will take a dive, and commodity prices will be softer for a short while.

However, at this juncture cyclical research rather suggests that gold prices will hold at 1360, - because all other parameters - weak currencies, a quick rally in bonds and equities into the end of January are the dominant scenario.

In that case we will stick with our asset allocation as is. We shall watch the next 48 hours with great interest. 

Happy Investing!

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