With a sharp lurch higher, December Gold has broken above the 1301.20 resistance I’d flagged as crucial to the intermediate-to-long-term outlook.  The rally is encouraging, but we should remain cautious for two reasons. For one, the move was catalyzed by news that Kim Jong Un-sane had fired a missile over Japan. As someone pointed out in the Rick’s Picks chat room on Tuesday, however, traders who have faded market moves caused by seemingly shocking news have only made money.  Indeed, every geopolitical crisis in memory, including the bombing of Pearl Harbor and the Cuban missile showdown turned out to have been a great opportunity to buy stocks at relative bargain prices.  Indeed, DaBoyz used these crises and countless others to shake down shares so that they could by more of them at bargain prices. This was clearly the case here. On Sunday evening, index futures plummeted on news of Kim’s brazen aggression.  But Wall Street, cynical as ever, treated the short-lived panic as a fire sale. The result was that, by the end of Tuesday’s session, traders had reversed a 134-point selloff on the opening to close the Dow up 57 points — a 190-point reversal. The second reason we should treat gold’s ‘breakout’ cautiously is that it is still well shy of election night’s watershed top at 1353.00. Until such time as that high is exceeded, the 1462.70 rally target given here earlier will in my estimation be more theoretical than probable. For now, caveat emptor. If you don’t subscribe, click here for a free two-week trial that will allow you to enter the Rick’s Picks chat room, where great traders from around the world swap ideas 24/7.

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 -- Published: Wednesday, 30 August 2017 | E-Mail  | Print  | Source: GoldSeek.com

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