Gold Bears Trying Hard

New York (July 16)  On Monday, after an early rally, the gold bears showed up and tried to force the yellow metal lower. They were successful for a couple of hours. But by the end of the day, gold had rallied back to close slightly higher for the day. This morning the sellers are back again, but the bulls are holding them off.

Often, we talk about patterns and footprints that markets leave, and once again gold is setting up in a bullish formation. The first thing to look at is the tightening range in price, which has tightened every day for the past two weeks. Secondly, we look at the price action; gold continues to make higher lows, which is also very bullish.

We remind you of two things -- markets never announce themselves, and price action leaves clues and footprints, which put the probabilities in your favor if you are patient enough to wait for them. The current footprint suggests gold is ready to break out to the upside and make a run. If it can get through $1,450, then $1,500 won’t be far behind.

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