Following the massive dollar sell off after the FOMC minutes were released on Wednesday last week, gold has moved steadily higher, though is now approaching a band of very strong resistance.
We anticipate that this area will cap gold's recent rise, particularly if the dollar recovers as we expect it will. In addition, the ongoing strength in equities will not help gold's cause and we are still within a weak period of the year cyclically for gold.
However, gold appears to be tentatively starting to form an important bottom in the 1150-1200 area. We have an historically high open short position and have seen devastating losses since April that mean gold is incredibly oversold - the market seems primed for a powerful rally when the time is right. We do not expect this to happen just yet, our subscribers are aware of our thoughts and strategy.
Oil continues its powerful advance, trading at $106 a barrel and is now aiming for $110 and $113 as the next targets. Above here and we are looking at an eventual return to the all time highs at $147 a barrel.
Today's video for subscribers looks at the recent trading and our strategy for our next trade in detail.