Monday, July 17, 2006
Here is an hourly chart showing pit and electronic trading in August gold futures. I last commented on this market here.
Over the past few days the war news from the middle east managed to push the market only marginally higher and today we have seen a big break in gold. The inability of the market to move higher on bullish news is a sign of serious weakness. This is the dog that didn't bark. All in all it looks like the market has stalled at the 662 resistance level and is preparing for a big move downward.
Over the next couple of days I think we will see a three stage drop to 623 or so. An real weakness below 623 will mean that a drop to below 500 has begun.