Wednesday, July 23, 2008

PM price action alert

This is a quick update following a second day of drubbing for the precious metals. The uptrend I drew in my previous post has been broken although GLD has remained above its 50 dma of $89.84. An optimist might argue that GLD is sitting at another more important trend line. Nonetheless, it's prudent to listen to the price action. If GLD closes below the 50 dma, it will be a good short given how gold trades. One may argue that the negative COT positions presaged this decline. Another indicator to pay attention to in the future!