Improve your aim!
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I don’t have a whole lot of commentary time tonight but I wanted to get this in because a number of you were fretting about today’s action. True, we did some pretty nasty technical damage on the price of gold, but not yet enough to convince me to run screaming. That’s doubly true with the faithful indicators of The PPT signalling oversold on the GLD trading vehicle.
I am seeing a lot of oversold conditions in the miners as well, as many of you are probably uncomfortably aware. This is not the time to be sinking your dough into highly leveraged bets, as the dollar can get away from us very quickly with an index break towards $80.00 and an escape from the double top condition we had just a week ago. That means those of you messing with AGQ better steer clear… y’hear?
Gold itself — the commodity — has been very good about respecting it’s 34-week EMA ever since the 2009 lows when the precious started making its epic comeback. I believe that weekly line will hold again this week, but beware — we may get a tail on this candle before Friday (note the other tail penatrations of the line in the historical chart below), and you may want to lighten into tomorrow’s expected bounce as a result. Here’s the chart:
Remember, it’s better to be safe than sorry at this juncture. Don’t be a hero and let’s play small(er) ball while we figure out which way the dollar is going to resolve itself.
My best to you all. Tomorrow, I will endeavor to get a short economic piece out challenging Mr. Henry Blodget’s latest brainstorm declaring that it’s not actually entrepreneurs who create jobs… but “demand.” (NOTE: as of right now, the post has been taken down or the link is dead… I think Blodgett realized what an ass he’d made of himself, but let’s give it to tomorrow to see what’s what).
I can retell the tale tomorrow, but suffice it to say that if this is the latest liberal shibboleth being trotted out to attack classical economics (and basic common sense), it needs to be nipped in its exceedingly innumerate bud.
Best to you all.
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