That is actually quite a theoretically strong resistance.
Many people believe that 1261 will be a point where gold will either sail or capitulate. A strong resistance will shake the weak hand either long or short and will make a big move. Right?
I don't think so.
The option players are betting $1500. That is one of the hottest contracts going right now. This is a contrary indicator and you don't want to follow these guys because they are wrong most of the time.
I have a friend who is betting a back spread on a gold ETF. This is a way to get modest gains if there is a drop and unbounded gains if it rises. However if the stock settles in between the short and the long calls.......Ouch!
My buddy is also a contrary indicator.
More importantly there is really no conviction and the times that I look for large breaks is when there are large coils (Rapid up and down movement). Now, with this said there are times when a big move can happen without an apparent chart indicator. This can be a large fundamental event. However, if we were to take a look at the chart right now chances are gold will be lazy. 1261 or 1278 or 1200.....Who cares. I don't think it is going to matter.
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