A poetic exit from gold

I sold my gold, and I no longer hold – I’m not that bold – I didn’t need to be told – it was time to fold. A sight to behold, I don’t fit the mold and won’t be cajoled – besides, the story was getting old.

OK, so poetry isn’t my strength .

 

Gold recently reached my target of 1300, as noted on my Feb. 17th 2016 blog here.

Below is my original chart (updated to last week), along with the target lines and mid termed/long termed trendlines. We sold as gold toyed with $1300/ oz last week.

gold long

Seasonally, gold can be a bit weak into late summer, and then experience its best relative performance from late July into the early winter. You will note the reversal day on gold on Thursday –as circled on the chart below. The inverted hammer (key reversal day) formation can lead into a short or mid termed corrective period.

You will also note a little weakness in money flow –the top and bottom panes.

gold neartermed

Brexit risks forced a cautious tone to the markets. I tried to use the fear as an opportunity to sell a bit of my hedges. My concern is the flock of investors into inverse, VIX, gold and other hedge/bear strategies. This can be a contrarian signal. While Brexit remains a great unknowable, I can’t help but wonder if the fear trade is getting overdone. We still hold lots of cash and largely low beta stocks. While I still hold some inverse and short ETF’s, our VIX and gold positions are now out of the portfolio.

3 Comments

  • GOLD: ON A WEEKLY CHART, DIDN’T WE CLOSED ABOVE THE TOP OF A BULLISH FLAG? (AROUD $1,300.) OVERHEAD RESISTANCE WOULD BE AROUD $1380.00-$1400.00 AND FLAGPOLE (IF THE CASE) PROJECTION AT $1500. WEEKLY PMO IS TURNING UP.

    Reply
  • Hi Keith

    Really like your all posts. You are good in educating about technical analysis.
    Regarding Gold, it is holding quite well and actually your resistance of 1300 acting as firm support. Are you changing your outlook on Gold based on this behaviour. Is the volume supporting this move of Gold upwards.

    Thanks
    Focus Group

    Reply
    • Daddyo asked the same thing–see my latest blog entry

      Reply

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