Gold Testing Upper Limits
The misery for gold traderscontinues. On Tuesday, gold rallied up to $1,212 before closing at $1,208. The $20rally looks like another attempt at breaking out to the upside but will morethan likely fail and test the bottom end.
This is the pattern until it'snot, and consolidation should continue. The longer this pattern holds, the morepowerful the next move will be. There are a lot of positive signs for gold thatare brewing underneath the surface.
Commodities in general arestarting to move higher -- cocoa, sugar, coffee and grains. Although gold andsilver are hard-asset commodities, the fact that the softs are now catching abid is bullish for gold.
Equities appear to be topping,making more new lows than new highs every day. The money flow appears to begoing into the commodities. Silver has broken out to the upside. We are bullishgold but will wait until gold breaks out above $1,220.
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