After yesterday’s sharp selloff in gold, today’s rally is most likely just a technical correction. If, however, December gold could manage a close above $1,796 that would bring in new longs. The gold market has been stuck in a big choppy sideways channel for so long now that it feels like it will never find direction. Every time it tries to breakout above it $1,800 it gets smacked back down, but also seems that gold is basing a long-term bottom in the $1,750 range. Until gold manages a breakout, up or down, there is a clear and tradeable range. I still favor an upside breakout due to all the idle cash out there and of course the longer lasting inflationary fears. Who still thinks inflation is “transitory”?  Signs of real inflation are everywhere, and inflation is structural. Gold, in my opinion, can only move higher from this current range that it’s been marking time in. I think playing gold from the long side still makes the most sense. I’d rather buy dips than “short” rallies.

Gold Dec ’21 Daily Chart
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Frank J. Cholly

Senior Market Strategist
Frank is a swap registered trader who brings his clients more than twenty-six years of commodity futures experience. He was a member at the Chicago Board of Trade for 10 years where he filled orders in the grain and financial pits. Frank was also a Lind-Waldock's floor manager for ten years and later joined on as a commodities broker.
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