April 8, 2020 - (Gold Market Wire) - Gold is struggling to rally although it is managing to stay above horizontal support. It's getting to be a conundrum: Is it a staging ground for a continued rally or is the market weakening? Right now, outside forces look like they could impact the market.

First and foremost amongst these is the state of the stock market, which, if it starts another down leg, could well cause Gold to take another 'dirt nap'. We have retained our length throughout and are still in profit, but we would be remiss if we didn't mention that concerns are building for Gold.

It's easy to be a non-stop bull for Gold, but that doesn't help the trading book. Right now stock markets have put some wind into Gold sales, but whereas before we were building solid length down at $1644, we are inclined to take profit on these small rallies and scale the book down even further. Gold needs a decent move over the old high at $1703, and really needs a move up towards $1755 - and a solid weekly, if not monthly close there... for us to get really bullish.

Until those objectives are met we prefer to scalp/job the market by buying the pullbacks to $1644 and selling them out on $4 and $5 moves. A solid move under $1644 means we cut and flatten the book completely. We should get enough action in these small parameters to carve out some money.

Above all... we prepare for the fact that the recent stock market rally may not hold. And if it doesn't - we stay out of the market until it finds a bottom.

Swinging for the fences will get you nowhere in this environment.