An inverted zigzag could have started in the first part of March and they can always get retraced by 100% or more so until this clarifies, I have to look at a short term potential bearish move in gold. Besides that I am starting to notice that I’m working into degree levels that are getting smaller and smaller. I only have two smaller degrees left from what I’m using which is not a good sign. It means I have to take another look on the daily charts to see if a higher degree is warranted. Any move down to $1300 would accomplish a complete retracement, but diagonal waves can trash the bearish outlook easily.
The US dollar may have a short term bullish surprise for us and until that has played out, gold will see downward pressure. Any moves in this commodities world can be very violent which many traders do not like! Get used to it because leverage is one of the main causes of violent moves. Bitching about violent swings or thinking commodities shouldn’t crash is a totally naive outlook. In commodities “fear” is the main driver of prices. In the general stock markets, it’s greed and hope that drive prices. Fear comes into play when stocks start to correct or head down.
I think gold still has to go well above $1375 as the bull market has consistently produced higher lows. If we don’t pay attention to higher lows then we will always get out before it’s time to do so. When gold makes a vertical move, then it may be a different story.