There was once again an amazing gold battle today. Today should have been the day ‘they’ slammed the gold price down 50 dollars and crushed the recent uptrend. But they tried and tried and just could not get the job done. The big different between this attempt at breaking the 1000 mark and the previous attempts is that during this attempt we have not seen rapid price failure upon reaching the critical 1000 level. On previous attempts there was a fairly rapid price decay soon after touching the 1000 level.
This gives me more and more confidence that the gold price will now trade without any resistance on the left side of the chart and eventually push on to new all time record highs.
Even with a record net short position from the commercials, the gold price still held steady and then at the end of the day managed a solid upside price reversal as a clear indication to me that we are ready to launch north going into September 25th, 2009. The seasonally most powerful portion of the year is September 15th to September 25th in the precious metals sector. Today’s action suggest to me that gold is ready to step up to the plate and take a swing.
I would not be surprised to see 1100+ gold price by September 25th, though near term price target speculation like this is not a precise science. No matter what price we see by September 25th, it seems fair to conclude at this point that the price action between now and that date could be very wild to the upside.
The gold mining stocks look like the clear winners as do the DGP ETF and the GLD ETF. Also the silver double long ETF the AGQ looks just as good.
The volume patterns on the GLD today looked outstanding to me and confirmed my super bullish outlook. In fact the real story is the 3 day volume pattern over the last 3 trading days on the GLD. The down day of yesterday was on about 50% lighter volume and today’s volume increased by about 60% compared to yesterday.
Here at BestOnlineTrades we continue to believe that the trading structure of the gold market is the single most important trading setup in the entire financial landscape right now.
The GLD January Call Options which I first mentioned here are up about 39 percent so far from my first mention. I think an ideal exit point for those could be near September 25th.
We made a key observation in the gold price after a 1.5 year consolidation. Since that observation the gold price has been going north like a bull running loose on the streets.
More upside to come the next couple of weeks in the gold market and the mining stocks. Don’t forget to buckle your seatbelts!