SP, you don’t need conspiracy theories to explain the gyrations in the gold market over the last week.
Last Wednesday Bernanke announced that the Fed would not monetize the US federal debt. I know, ho, ho, ho. But the average trader in the USA, not being as bright as us, believed it, sending treasuries down, the greenback up above the 80 resistance, and gold down below the 960 support. This took many people, including myself, out of gold equities.
In the last day or two, US trader’s have had a rethink about Bernanke’s speech, so treasuries have been rising; the greenback fell back below the new 80 support, now resistance; and gold had an unsuccessful crack at retaking 960.
Which way will things go now? I’ve no idea. But, as the overall market is looking a little soft, I will be staying in cash until things are clearer, i.e. gold retakes 960.
Like yourself, I took a hammering in last year’s market, and I now have a bias towards early exits. You can always buy back into the game. So far this year the strategy is working and I’ve made back most of the losses.
Best of luck.
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SP, you don’t need conspiracy theories to explain the gyrations...
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