News, analysis and commentary for gold traders and investors

"Be Right - Sit Tight"

Jesse Livermore
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Gold Market Wire... Gold Market Wire... Gold Market Wire
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Gold Market Wire

News, analysis and commentary for gold traders and investors

Gold Market Opening

Gold under Pressure as 50-day Moving Average Comes in to View

September 7, 2020 - (Gold Market Wire) - Gold's uptrend line has been broken this European a.m. and now stands at the gate of the 50-day moving average which it will have to fight to stay above. Make no doubt about it - the market is weak.

...trend line broken

Gold, right now, is in the grip of some fairly serious concerns about the state of the US (and global) equity markets. Traders are getting concerned that a pre-election sell off, after an outrageous run up in the past few months are leaving assets vulnerable to a correction. Apple, perhaps the biggest bellwether stock in the financial universe currently, shed some 20% last week...albeit from stratospheric valuations... but still, it was a shot to the market's confidence, nonetheless.

Gold is not immune to such movements and the strong down moves on Wednesday and Thursday shadowed Apple's moves.

what goes up...

So, as Monday's New York stock market opening looms, the market waits, with fingers firmly jammed in ears. We've had the fall, we've had the bounce, and now, probably this week, we are going to find out whether a very well rested bear is about to spring into action.

Our decision to abandon the metals market was the right one. Only a fool stands in front of a freight train. There is really no place to be but the sidelines. While we have little doubt that the bull market in Gold and Silver has quite a distance to travel over the next 2-3 years, right now, from the trading side, we must wait for the increasingly dense smoke to clear from the market. It must always be remembered that late-August, September and October have some fairly seasonal/historical precedents within them for equity blowouts to the downside. That history has to be respected, especially after a run up like we've just experienced.

Wile-eyed gamblers could venture a small short, if the 50-day moving average gives way and equities start to plunge (tech will give the nod), but such trades are really of the gambling parlor variety and should be sized as such. A strong follow through bounce higher today, especially in the opening hours, could create an opportunity to purchase what is essentially a lottery ticket, and should be properly sized like one. Strap yourself in, because this is likely to be a rollercoaster week.

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