Gold – 5 Oct

Gold was up and down the entire day and closed up well off the lows of the day and again the 100 day moving average provided resistance. The low of the day was just under 1600 and for the second day in a row there were significant buyers there. 1585 remains support and 1675 is resistance. The current uptrend remains intact as long as the swing low at 1585 holds, then we look for a higher high to take out 1681. What I find interesting is that during this pretty intense smack down the RSI never hit over-sold levels at or below 30. That really speaks to the fact that big price moves aren’t necessarily big percentage moves when you start at 1921. This is just a garden variety correction and consolidation in gold and literally nothing out of the ordinary. I still expect a move to and beyond the all time high on the inevitable QE coming from the Bernank.

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