Email of the day (1)
"Very much enjoying the service."
"In last night's video, I think you said that gold would have to fall below $1600 to jeopardise the very bullish outlook. As it is $70 below the current price, would you say a break below the 200day ma, were it to occur from roughly current levels, would be a warning sign? I want to ride the trend but remember all too well the volatility in precious metals!"
David Fuller's view Thanks for the feedback and a question
likely to be of general interest to many subscribers.
What
I actually said after listing a number of bull factors, was that "gold
would have to fall below $1600 to question" the very bullish outlook.
Basically,
in listening to the Audios, you will know that gold (weekly
& daily) has done everything required
up to this point, to demonstrate that it was in a support building / accumulation
phase prior to a significant recovery and resumption of its overall upward trend
in 2013.
As
I see it, the volatility which often favoured bears occurred during what I described
as the first-half, distribution phase of this lengthy medium-term corrective
period. Following the May trough which tested the 2011 lows and held, I have
felt that gold was demonstrating that it had moved onto the initially gradual
recovery phase in line with seasonal factors.
I got
my tactics wrong in the early stages of the support building process because
in a triumph of hope over experience, I was holding out for an earlier completion
of the ranging phase when I should have been doing some Baby Steps buy-low-sell-high
range trading. One could still use that tactic with part of a long position
but I think gold has now embarked on a recovery phase more suitable for trend
running for the major portion of one's position. In this case, it might be better
to have looser rather than tighter stops, at least until the price accelerates
higher.
We all
want to protect profits although not at the cost of coming out on a minor reaction
relative to the uptrend that should now be forming in gold. Personally, I would
probably be buying on a move back towards the MA, as we are only three days
into the breakout phase.