Few things which gave gold its recent new high are fading away. Nobody fears Brexit anymore. Equities are not subjected to acrophobia either. Two big fear drivers are out right now.
Gold’s inability to take out 1400 level left many fast money traders bailing out of the positions. Now 1300 is really a line in the sand. Any downfall should be arrested between 1300 and 1280 if Gold want to sustain the rally. Otherwise 1200 will be on the radar quickly.
Only thing going in favor for Gold right now is the action of central banks. Nobody is talking about when they are going to rise but instead how much room they still have to ease. BOJ is going to go full throttle now in desperate act. BOE has just talked today about more stimulus. In this environment we don’t want to short Gold but rather trade it from buy side.
1300 and 1280 should provide quick trade levels. And depending upon how it develops, we can either keep it or cut it. If 1280 gives away then we will reevaluate but will still look it from buy perspective for near future. Because markets may lose its fuse any time in this environment and Gold and Silver can rocket higher quickly. Don’t be greedy and take that quick bounce to take profit partially.
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