Public Post – Whats Happening With Gold?

I received a good number of emails where people said that they were “Going short for the final plunge in Gold below $1000!”.   I’m not saying that that plunge wont come, but does the evidence point to last weeks break down being the signal to go short? Lets look at some charts and see what I wrote in my weekend report. 

The USD Wkly looks strong and has weakened Gold, but will it break out & run or might it pause or even double top?

If this is a rising wedge, the dollar will stall (or fall) and Gold could pop. I wrote a few bullish and bearish points on the chart.

THE CRB  –  If the DOLLAR double tops, the CRB would likely bottom. It is at support and overdue for a 3 yr cycle low. This would imply that the Dollar will top.

Lets talk about what happened in GOLD last week. 

EDIT:  This is from the weekend report unless I note otherwise

GOLD –  Friday New lows. Please note that  Silver & Miners are not following.  They usually lead the way down. With that I have to wonder if this is a final shake out similar to that quick drop in July?  Many have gone short & are bearish now again.

UPDATE : Monday Gold recovered  while the USD went higher.  

SILVER–  Silver held recent Nov 23 lows as it sold off and reversed higher Friday. In fact, the MACD is trying to cross upward at these lows. I would be nervous “Shorting Silver” here.   It didn’t drop to new lows with Gold and the MACD is gaining traction.

AG – Is a silver stock.  This looks strong for what happened this past week.

SSRI  –  A Silver stock that is holding up on the 10sma  despite recent selling.

GDX – I drew this mid day Friday to show that  GOLD broke to new lows and was staying down there, but Miners held their Sept 11 lows,  and also didnt break the recent November lows from a week ago.  HMMM  

UPDATE AS OF MONDAY : So look at components of GDX.  Is this a sign that Gold is about to plunge after breaking to new lows?  or does this look like smart money could be accumulating Miners? Should you short this?

NEM –  Gold broke down to new lows,  NEM looks strong.

ABX – Gold broke to new lows, ABX is holding up well.

SA –  Another  Gold stock that is ignoring Golds drop. This set up was actually being pointed out as a buy at the 50sma for the past week.

  Finally, this is the C.O.T. released Monday.  It shows that SMARTMONEY has bailed out on their shorts for Gold.   They are NOT heavily short Gold.    The prior  lows for GOLD are pointed out, and smart money shorts are less now than they were at the prior lows.   Should you be shorting when SMARTMONEY is not?

  GOLD broke down to new lows Friday and I read on stocktwits and in other areas that many  people were now shorting.   Silver and Miners didn’t follow as shown above.  In fact, some Silver & Gold Mining stocks are even holding their 10sma as of Friday.  The C.O.T. shows that Smart money was rapidly closing their short positions.  In my weekend report I was pointing out that by leaving emotions about that break down aside, the evidence was bullish too.   Monday we saw GOLD recover and Miners move higher, while the dollar was green too. If you are short, you must make sure you have stops in place.  I believe we could Rally or have a good bounce at least.

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~ALEX