Gold Gets Clobbered Along With Equities
Tuesday was an ugly day for gold,as the metal started lower and never came back. Gold has lost $33 from itsrecent high and is getting closer to our first target of $1,300. Equitiesdidn’t want to let gold suffer alone as they also got clobbered. Both marketsare a mess now and are in danger of taking out recent lows.
Manipulation of currencies by theFed and central banks around the globe is causing this uncertainty in allmarkets in general. The desire to control the dollar, which helps artificiallycontrol rates, is creating problems for investors and should keep the pressureon gold and equities. To quote Oliver Hardy talking to Stan Laurel, “anotherfine mess you have gotten us into.”
For now, we are sellers ofrallies in both gold and equities but expect some rip-your-face-off rallies inbetween. It would be no surprise to see gold rally today, but we would besellers around $1,340. Long-term investors should ignore this action; themarkets will be higher over time. Traders should be ready to short rallies andcontinue to do so until gold closes above $1,365.
Contributing tokitco.com
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