This guy has been darn good. Read his past articles to confirm. We go much higher and not that long from now:
Gold/Silver - What can I say? I gave you a price target of 728.60 on February 9th, expecting to see it hit by late summer. So much for late summer! We hit the target of 728.00 intraday on Thursday, May 11th, and then exceeded it intraday, reaching 732.00 the next day. The question is, where does the price of gold (and silver) go from here? Is the rally over? Will the long awaited correction finally make an appearance? And if so, how low is low? All good questions and, in my opinion, all quite premature! I am going to tell you the same thing here that I told you on February 9th, unless gold has undergone some here-to-fore unperceived change in character, we have not yet seen the top. It is also worth remembering that neither have we seen a close above strong resistance at 728.60! We've seen a test and we still have another test or two coming in my opinion. In the meantime, a 5% to 8% correction over a period of three to four days would be nothing out of the ordinary! That translates to a drop of +/- 60.75 and a test of good support at 671.25 in the JUNE GOLD futures contract. Such a test could easily occur without doing any technical damage to the current bullish gold picture.
Please take a look at the following Daily Chart of Gold and tell me what word comes to mind? Relentless maybe? For months now, it has consistently ground up every attempt to turn the price down:
Is gold overbought? Yes! And it can stay overbought for a lot longer than you can stay solvent trying to sell it short. The current target of 728.60 is the resistance of last resort before we go after the all-time high of 887.50. Given what I have seen to date, I suspect that we will keep right on going and not stop to correct at 728.60. You can give me all the reasons you want for a correction, but the price action of gold is saying something different, and has been saying something different for months. It's just that very few people are listening and that is the biggest point in gold's favor at this point in time: everyone doubts the rise! Even my own clients doubt more often than not.
From a technical point of view, a one-day decline of $20.00 or $30.00 seems like a big deal, but at this altitude it really isn't. Right now, if gold were to decline all the way down to 650.60, nothing would change except for the pulse, heart rate, and perception of many investors. Strong support is at 644.70 and should hold under just about any foreseeable circumstance. As far as the upside is concerned, two consecutive closes above 728.60 would indicate an attack of the all-time high of 887.50 would become the order of the day. With respect to gold's orphaned cousin silver, I expect silver to follow gold to the upside for the time being. We are currently trying to deal with resistance at 14.81, and although we managed one close above it, it wasn't quite enough. Over the long run, silver will attack good resistance at 20.73 and maybe even go after 26.11 before the year is out. By the end of this decade I expect to see gold trading at US $3,000 and silver at US 164.00. The volatility to be encountered on this long and bumpy road will be too much for the average investor and very few will actually reap the rewards from such a spectacular Bull Market. Those that do manage to stick it out will be rewarded with a better life.
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