A) The XAU closed at it's lowest level in about 3 1/2 weeks yesterday. (not looking too good so far today...oops). You're sposed to buy low sell high, right?
B) Gold/XAU lately is susceptible to incredible price swings. The calls could bleed to death for 3 weeks and then be resuscitated in just one or two trading days.
C) I like that gold has quieted down a bunch and the mo-mo players have moved on. Now the XAU just needs to find some support here in the low 70's and then resume it's short-to-medium term upward trend.
D) Essentially I think the charts are turning for the better. The XAU has held above 50 DMA for last couple of months, and it sits around 72...only a couple points away. I think it will hold. I see strong support around 72, I guess I jumped the gun a bit early.
E) All the standard arguments like gold carry trade, too many shorts, favorable demand outlook, less central bank selling, rising rates, falling dollar, etc. can't hurt either.
And Now For The #1 Reason I Am Bullish On Gold!(actually I have been bullish on gold since last month, *before* the 2 day explosion. I took a serious look at XAU calls back then, but AOL was in the 80's and that trade got the nod over gold. (I am still quite bullish on AOL)--barring any serious decline in the market. I am on the fence right now about the market. When it has a horrible week down 5-6% I scoop up some net stock calls. After it rallies 4-5% in a week I become more bearish. Considering the market had a rough week last week, I am cautiously bullish this week with MSFT/AOL earnings (which I think will be good), and I like VERT (a B2B e-commerce stock) ahead of it's results Thursday.
NOW...
...back to the #1 reason why I have been bullish on gold lately.
That huckster Art Bell has been whoring himself on his radio program hyping gold left and right for the last $125-150 of the decline in gold. (Soybeans too). After being wrong for so long, he and his advertisers started to shut their claptraps in m-bare-ass-ment. If that aint a buy signal I dunno what is. (hehehe) |
