The torture of a consolidatingmarket is playing out as scripted in the metals. Gold and silver held the lows,rallied to the top of the range and once again are failing today.
With gold now hovering around the$1,200 level, it could go either way from here. The level to watch on thedownside has moved up to $1,190 and a close below that could cause issues.
We expect gold and silver to holdthe recent lows and move higher. The charts look healthier than they have inmonths and given our choice would love to see this consolidation patterncontinue for a few more weeks as the metals build a base. Typically, the longerthe phase of consolidation -- which is usually the birth of a new market -- themore bullish we would be. For now, it's patience and observation.
By Todd 'Bubba' HorwitzContributing tokitco.com
Follow @Bubba_Trading