Gold Is Bracing For A Short Term Correction

Posted on Posted in Daily Blog Post

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www.barchart.com .

The Commitment of Traders report (COT) for gold indicates the short term rally in gold is coming to an end soon.

As shown in the chart above, The Large Speculators which usually is called “dumb money” now are in the largest long position in gold, while the Commercials (smart money) are in the largest short position in gold. Normally, the smart money (Commercials) wins the tussle.

I expect gold to pull back either today or tomorrow to 1280 from 1345-1350. Meanwhile watch out for breaking big resistances 1350-1360 if gold refuses to give in.

Are we near to a new bull market in gold and silver? When is the time to buy gold and silver at the best possible price for a major rally? Are we still able to see new lows in gold and silver in the next 2 months? All these are covered in the reports reserved for paid members.

SPX

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Stocks have declined from July 7th's open after the 4th July holiday. So far, SPX has pulled back to 1952 only. It seems to me this is a shallow corrective decline and not an impulse wave decline. I still expect a new high in the next 6-7 weeks before the much needed correction of 10%.

There is an outside chance that the decline from July 7th is the start of a decline from the small rising wedge (chart above) that I have been expecting and if that is the case, more downside is likely next week to reach1920-1940 before SPX takes stocks sharply higher around 2100 by July/August.

I would suggest to Long around 1920 (next week) and SHORT around 2100 (July/August) with tight stop loss if unfolding accordingly.

I expect a big correction of 10% in August/September and I suggest go LONG aggressively from October for the year-end rally.

I will keep you updated. Stay tuned!

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