On second thought… August 7, 2009
Posted by Warren in Metals, Strategy.trackback
I had initially thought that PM could launch a rally pre-FOMC meeting, but it looks like risk is due for a pull back (but only for the short term). Consequently, I expect the dollar to rally for the short term. I’ve taken profit on my PM (a very good run!) and shorted some as well. Eventually, however, I expect the long term triangle formation to be broken fairly soon. In terms of summer seasonality, one can argue that we’ve already passed the seasonally weak period. August is also traditionally a pivot month for a rally that extends into spring of the following year. As for my downside targets, I expect gold to drop to about 940 (50 dma) and silver to drop to about 14.250.
Gold 6-month: very neat triangle formation is near its end…
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