Is gold headed to 1261 with fireworks?

  1. Ben Evans profile image72
    Ben Evansposted 7 years ago

    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.