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

The Sell-Off Commences

December 11, 2023 - (Gold Market Wire) - We warned on Dec. 7 that close attention to the uptrend line was necessary, and that the market needed to get a move on. It didn't...and down we went...and down we go. Our trend line, identified then, got us out in good shape though.

our trend the past, now.

When Gold gets ready to move down, you have to get out quick, because the sellers all jump at once. (That's for the trading position.) There were a few indicators behind the move, but the strong(er) dollar, and the fact of a market that's gained about 25% in roughly a year could be another...especially as we draw near to the end of the year, and we get book-squaring. The chart gave us the clue, and the feel we had was one of general weakness; ergo our admonishment to 'get a move on'.

One thing is for sure... you just witnessed some master game playing in the market. A few of the big players pulled the sell side of the market on the Asian opening on December 4, and it worked a treat. That got them out...and the massive price spike was no fat finger... and no erroneous print. That was the big players evaporating the sell-side of the market, right as it was faltering, and getting out of their length, as the suckers ran into the trap as they chased the market higher. (Who was it that said, "Never chase strength in Gold."?) Now they will have a Merry Xmas - and many others, the little people - won't. The metals markets are run by pros. If you don't know how the game're the sucker to be shredded.

What now?

horizontal added.

Horizontal support comes in around $1950, but the problem we have now - for the perma-bulls - is that the month, quarterly and yearly closes look set to be bad ones. Make no mistake: This rally has died and gone to heaven, and it won't be back soon, unless there is an exogenous event. So we have no desire to scale into it as a buyer. We are on the sidelines, and if anything, we are looking for short-scalp action.

Is the Bull dead? Not by a long shot. But it won't be back in a few days...or even a few weeks. The market trend has been violently broken at the end of the year and that means the main players have pulled their length. If you want to try and be a hero, go ahead. And who knows... there is always the chance you will be right. Be we deal in risk/reward and probability. For us, being a bull is not an odds on trade anymore in Gold. It will be sometime in the next 3-6 months, we think. But its not now, and likely won't be for a while...and by "a while" we mean at least a couple of months.

Let's see how our journey to $1950 unfolds. Markets are made to test people...and that level will be one of the first tests, and an important one.

Spec short on a decent rally is the stance. As we said, our hawk eye on the trend line told us when to bail.

Discipline, as ever...especially at year's end.

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