Whoah! What a ride that was! I meant to publish this yesterday but spent much of the day in bed with some of this crud that has been going around. Back to work today though.
So the party was over way too soon, but we did the right thing leaving the party before it was too late! How overbought did this get? The RSI readings were near record levels. Like the market was last summer, I don't think the RSI will have much of an opportunity to reset back to oversold conditions for a few more months.
I don't expect we will be on the sidelines very long. I would like to see the price of gold (POG) consolidate the rest of the week to allow the 10 day moving average to catch up to price. That may be the extent of a correction.
I think we still have a couple months left of this run. Technically speaking, we are in the timing band for a daily cycle low, but moves such as this tend to distort the cycles. The price action of gold last summer probably provides the best model to follow for how to trade this market.
We may get in early. That could mean another nerve wrecking period of a few weeks like we went through just before gold exploded to the upside. I would rather endure that grind and capture most of the move higher than have to chase and capture only a small part of the move. We will get involved with Silver when the time comes as well.
The Speculation page is used for educational purposes and to talk about our opinion on trades and what is going on in the market. All trade recommendations are made in "The Pit". This is also a blog page where you can ask questions, post your thoughts, or ask for help. Be sure to use an anonymous name. If you have any questions feel free to reach out to us via email.