Gold was one hot commodity over the past few days thanks to a perfect storm of fundamentals, technicals and the dollar. But don't let the edited title of today's column fool you, I am looking for higher prices.
So why title this post "shines and implodes?" Because the yellow metal hit resistance and retreated - in a big way.
Check out this chart from Futuresource.com.
That is one intraday failure, boy howdy! Given that it took place at resistance and with a huge fanfare of hitting the 1000 mark - which is nothing but a number on the chart, BTW - I have to think that we will get a better chance to enter long.
For disclosure purposes, I have owned gold since 570 and again somewhere in the high 800s (I think). Anyway, that it fails to hold above 1000 again will make the armchair technical analysts say "I told you so! Deflation is coming."
However, 1000 is just a round number and not a place where true technical resistance exists. A pullback now, maybe 50 bucks, would shake out the weak hands and set the stage for a true upside breakout.