Just a coincidence, of course, but gold has broken down right after my July 19 post GOLD: NOTHING TO FEAR BUT THE LACK OF FEAR. Since technicians and momentum players pay great attention to charts like Gartman’s below, “investment demand” for gold could unravel rapidly. My post warned on the lack of “real, fundamental demand” to help support gold in situation like this. Let’s watch (from the sidelines), even more so given the currently unfavorable seasonality of gold.
Regarding the gold market, what can one say other than any and all support for gold has been broken, evidenced
by the chart of spot gold in US dollar terms. Having led a long campaign in favour of gold over the course of two years, we are on the sidelines, holding only a marginal, residual, small, tiny, unimportant “insurance” position in the metal that we wish to have “just in case.” Otherwise, were we forced to take a trading position we’d sell gold short, for the longs now have several months of strong overhead resistance to overcome before they regain the upper hand. That may well take weeks, if not months, to accomplish and we’ve other markets far more interesting to involve ourselves in.
Dennis Gartman
Related posts:
- China Wary On Gold. Will China Buy Gold Mines?
- ALAN ABELSON: A CONTRARIAN VIEW OF GOLD
- RISKS, HEDGES AND OPPORTUNITIES: GOLD
- RUSSIAN CENTRAL BANK’S GOLD HOLDINGS KEEP RISING
- GOLD: NOTHING TO FEAR BUT THE LACK OF FEAR
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