$1,280 -- Here We Come
The struggles for gold continue,as commercials are short the metal in record numbers. Interestingly enough,their short position in silver has never been this small. The commercialsaren't always right, but it's hard to fight them because of the amount ofcapital they have at their disposal.
Gold remains weak and every rallyis met by sellers, with gold making lower highs and lower lows, indicating thenext big move is lower. Resistance appears to be $1,316 to $1,320, whilesupport comes in at $1,300 and then $1,280. The strength in the dollar is acontributing factor in the pressure on gold, but there is more to the story and$1,280 is in play.
On the other hand, silver looksto be at a support level and is headed for $17. The gold-silver ratio isstretched once again, trading at 81. Expectations are for the ratio to fallbelow 70, making the short-gold, long-silver trade attractive.
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