Yes, it looks like a pause in a decline.  Gold has just gone sideways for a couple of days. Although it could rally from the 50 day moving average which is not that far below here (GLD 50 day mav = 134.54 for ex.), I believe gold is in a longer term retracement.  More intermediate than short term.  My downside target is around 132 and then a bounce becomes likely.  Keep in touch by following me on Twitter as DavidBDurandMD.

I do see the possibility of a rally back to around 138ish for GLD but I do not believe that the correction will be over at that point. The next move should be down from there IF we get such a bounce.  Tops can take a while to form – quite a while.  Why?  Because investors get stuck doing what they did last month even if it does not work this month.  Don’t do that!  I am NOT advocating the liquidation of your long term position in gold any more than I would recommend you converting all your US dollars to Euros.   But to me, trading positions are different.  When the trend changes, I change and my trading positions go to zero after a failure at a major top.  I can always buy higher.  I don’t need to “ride the pony down the hill.”   You can quote me on that!  ; )

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