-- Posted Friday, 27 March 2009 | Digg This Article | Source: GoldSeek.com
We view the action in gold yesterday as constructive, even though its ups and downs didn't net out to anything terribly exciting. Notice how the little orgasm early in the morning exceeded a 944.60 peak recorded a few days earlier. That created a bullish impulse leg on the hourly chart -- always an encouraging sign. The rally detumesced, ending the day on a disappointing note, but it was not quite the selloff we might have expected, given the strong performance of the broad averages. Clearly, although bullion has been lackluster as stocks have risen in the last week, it is no longer getting hammered just because investors are momentarily obsessed with the idea that maybe, just maybe, President Obama, Geithner, Bernanke and of course Larry Kudlow are succeeding at bringing the financial system back into balance.
In any event, we'll stick with the rally target at 1001.10 that went out to subscribers Wednesday night. It may take a while, though, since we don't see the short-squeeze that has been driving the stock market higher ending quickly. In fact, the rally yesterday in the S&P Index created its own bullish impulse leg on the hourly chart, renewing the bull trend. I've included a target for the E-Mini S&Ps in Friday's touts that implies that considerable buying power remains to be spent. Will Friday craziness exhaust this potential? We'll be eager to find out, since DaBoyz appear to have put this trading vehicle in a holding pattern Thursday night. Our guess is that if they take it down four to six points overnight, it will mean They are eager to buy 'em.
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