News, analysis and commentary for gold traders and investors

"Be Right - Sit Tight"

Jesse Livermore
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Gold Market Wire

News, analysis and commentary for gold traders and investors

Gold Market Update

Metals in Indecisive Churn

April 27, 2021 - (Gold Market Wire) - Sometimes, in life, as in trading, its just better to close out and wait for a clearer picture. That is the survival element, so necessary when trading Precious Metals. The key to making money in the arena is to find a developing move and ride the trend, and get out before a reversal emerges...and, of course, to always refuse to 'marry the trade'. That means, also, trying to avoid getting caught up in a choppy trade, which leads to expensive over-trading, and neurotic behavior. GMW thinks we are in a just such a phase now, and that was behind our decision to close out the last 1/3 of the position yesterday. We have had good profit from out length, but the market is churning around - vacillating like an indecisive dog caught in highway traffic. Avoid.

...chop...chop...chop

Our downtrend line isn't indicating very well - and is causing weak head-fakes in the past few sessions. The uptrend isn't encouraging either.

The stochastic looks bad for the market, but the moving averages are starting to turn. One big sell-off before 'blast-off'? Possibly. But it would be just a guess. And that's why we prefer to stand aside. The market isn't trending right now, and that is simply the way it is. Scalping in this environment would just produce a headache.

Gold is fairing no better.

We take some comfort from the fact that our most favored long-term indicator - the Gold/Silver ratio is still weak.

...still trending down.

What to make of it all? Well, firstly is the fact that the market seems paralyzed. That could be foreshadowing a move one way or the other in the near future. The second point, which we take-away from the ratio, is that the market has underlying strength. We add this to the wholesale chaos engulf the western world, and a general re-emergence of commodity price inflation, and that paints a picture of a Gold and Silver market that is going to move higher at some time  this year.

Investors should show patience and accumulate on significant pullbacks, up to 20% of investible assets. Traders will have to be patient for a better set-up than we have right now.

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