Gold Review for Wednesday 9/09/09 By: Thomas Hartmann, Altavest Worldwide Trading, Inc.
-- Posted Wednesday, 9 September 2009 | Digg This Article | | Source: GoldSeek.com
Dec Gold: Open= 998.8 High= 1005.0 Low= 9888.8 Last= 992.2-7.6
Gold failed for a fourth straight session to decisively move above $1,000.00. Despite stronger stocks and a lower U.S. dollar, bulls could not sustain positive momentum yet again. Overnight highs were sold into and the ended up closing lower this afternoon. What could be causing the market to pause after surging higher by some $50 an ounce in the past week? Part of it is just that, a pause and possibly a correction. The market is also overly bullish and the commitment of traders is tilted heavily on the long side, suggesting that the upside potential could be limited until these balance out.
The rally in stocks is likely absorbing a lot of cash that’s been sitting on the sidelines as economic sentiment improves many investors will want exposure to stocks again. The Beige Book reported the Fed seeing signs of the economy proved, which helped send gold prices into the red around noon today. While the angle to play gold is from the bullish side still, some amount of caution is warranted. Those long futures might consider selling calls against their positions.Consider buying gold on a sharp pullback and placing a stop below $945 or wait for a strong close above $1,000 before adding to any positions.
Review charts on these markets here www.britefutures.com. Remember that futures and options can be used for bullish or bearish positions; feel free to contact me to discuss trading strategies. Each contract/option = 100 ounces, a $1 move in a futures contract = $100.
To open an account and receive trading recommendations on gold futures or options contracts (also stock indices, energies, currencies, etc.), or to use our online paper trading service BriteTrak,contact me attom@altavest.com. Visit www.altavest.com to request a FreeTrading Kit. Keep in mind that there is risk of loss in all trading.
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