Gold on the brink
Posted by Danny on February 4, 2013
The S&P 500 and the Dow Jones Industrials index have come very close to their all time highs last week.
Even though there is a pullback today, I think we will see another attempt to set new high marks this week or next.
Meanwhile let’s have a look at the Nasdaq index (click for larger image):
The Nasdaq has a little bit more room to rise. Could reach 3225 in the coming weeks.
But the Earl2 index is showing the first signs of topping out, which means a more significant correction is likely to start within the next few months.
***
As chart of the week we take a look at gold prices again (click for larger image):
The precious metals markets are going to get interesting soon. Gold appears set to break out of a narrowing triangle.
Which way will it go? Markets have a habit of putting investors on the wrong foot, before making a move.
I think we will see a weak attempt to get above $1700, and then a sudden move to the downside.
Unless gold breaks above $1800, there is no reason for enthusiasm.
I will be selling my gold related positions this week, and will buy them back after we get a good correction or on a break above $1800. In the worst case I will have given up some 5% profits.
PS: if you missed out on our forecasts for 2013. They were published last week and you can find them on the Four Pillars Finance blog: here.
Good luck,
Danny
LunaticTrader 
roni said
hey danny
i didnt see any comment o n the us dollar in the 2013 forecast please can u tell when do u see peak and bottem for the dollar in 2013 ? tnxxxx roni
Danny said
Hi Roni,
The forecasts for the major forex pairs start on page 8
roni said
hi
i ment to the dollar index
Danny said
We don’t cover the dollar index, as most people are trading forex pairs.
But basically you would expect the dollar index to go up if the Euro peaks out around 1.40 and starts going down again.
roni said
tnx :)
pjsmitnl said
Thanks for the 2013 Forecast
Regards Pieter , Netherlands
Danny said
Glad you like it.
Danny
Gold on the brink – part 2 « LunaticTrader said
[…] few weeks ago we warned for a possible sudden move downwards in gold prices Meanwhile gold has dropped more than $50/ounce and is now sitting just above $1600. What’s […]
Will buyers appear? « LunaticTrader said
[…] Gold on the brink […]