Buzz & Banter
Robert Prechter, the well-known bear of Elliott Wave International, has made no secret of his belief that gold will take another leg down before the real bull market in gold begins, but he has also made it clear that a move above $400 would probably force him to reconsider his bearish near-term posture on the metal. That is but one of the reasons a fresh breakout (above the February highs) in gold would attract much more attention than it has been getting lately.
Technically, the December contract looks positive but the real hurdle is at the February high of 386, which in my opinion must be crossed before all signs are go. Gold works best when it is moving in tandem with silver, which has made a new high this morning. As I said, the moment of truth time is approaching. I believe gold must make a run to new highs sooner rather than later if it is to maintain its strong near-term technical pattern. In the long run, of course, I am a strong believer in the gold bull market. The problem with new purchases here, in the absence of a confirming new high, is that gold could correct by $50 or more and still maintain its longer-term bullish structure.
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