I liquidated my gold position on Friday. A large down day after strong upside momentum like the sell-off Friday is usually met with either consolidation or selling. I will be watching gold closely and hope to re-establish my position in the not-too-distant future.
This bull leg in the gold market is acting remarkably similar to the upswing in 2007 and 2008. We had a similar sharp pull-back in November 2007, followed by a consolidating bullish wedge formation, which broke out a few months later and moved to $1032 in March 2008. I will watching closely to see if a similar pattern develops over the next few weeks.
I have been selling down positions in the stock market this month and hedged out my remaining positions on Friday. I am now actually slightly net short, primarily because I apparently can no longer do math. Having said that, I am happy to be net short, and will be looking to get even more short in the near-term.
As long-time readers of this blog know, I could change my mind tomorrow and completely reverse my positions once again. Thus, it is best not to trade and invest solely on what I write. (Oh, they know that. - ed.)