Click on Chart to Enlarge
This chart shows that the recent leg up in gold is likely over based off this 2 day correction. Not shown is that price spiked above the upper channel line of this leg up on Monday and Tuesday.
Click on Chart to Enlarge
Applying the same logic to the entire 2008-2011 bull market, we see the same thing. A spike above the upper channel line. And now the beginning of an aggressive decline. See the notes on the chart, but a move to the 1625 area would be a more definite sign that this bull market is over.
I may have shown this the other day, but this price high is also near the upper channel line from the line connecting the 2006-2008 highs. That is the main channel of the entire secular bull market in gold over the last decade.
Point being, we may be seeing a MAJOR top in gold here. There is just no good technical reason to be, get, or remain long gold here. At a minimum, wait for a correction and re-evaluate after price falls in line with normal historical corrections.
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