We Are Quietly Seeing A Gold Rush
Friday’s U.S. jobs number was ugly but had the built-in excuse of hurricanes Irma and Harvey. Since the Friday morning lows at $1,262, gold has rallied $30 to $1,292 with no fear in the world or in the equity markets. The $1,262 support level has acted like a trampoline for gold, with the biggest two-day rally in months.
This move indicates there is some underlying problem that has not made it to Main Street yet. The move has been fast and is continuing today as gold makes another run at $1,300. The $1,262 area was a very important level to hold and confirms to us that the bear market is over. A small pullback from $1,300 will be no surprise, and gold should be able to make a run at $1,340.
As traders, we look for a reason that out of nowhere gold has made this big move. They could have caught traders short and we are seeing a short squeeze, or more likely there will be a news item in the next couple of days, possibly out of the European Central Bank, that is driving prices higher. Either way, gold has held the technical levels perfectly and we are looking for pullbacks to buy