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China’s “Golden Week” holiday is underway and gold markets there are closed for the week.
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The demand vacuum created by this holiday often contributes to a gold price swoon, and that’s happening now.
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Please click here now . Double-click to enlarge this GDX swing trade chart.
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My www.guswinger.com subscribers are enjoying the price swoon because they took my key signals to buy DUST and JDST.
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Swing trading is a great way to make money in a gold market correction.
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The booked trading profits also give investors confidence to add to core positions when overall investor sentiment and news is negative.
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Note the big green support line on that GDX chart. If GDX trades down to the $24 area, long-term investors should place buy orders for GDX, GOAU, SIL and individual miners.
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“An environment of negative and lower-for-longer real rates, slowing growth with downside risks, and elevated uncertainty strengthens the case for holding strategic gold allocations.” – UBS bank analysts, Sep 30, 2019.
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The UBS team also notes that the current steady action in gold on rallies and declines is typical in a trending market.
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They just raised their 2020 target price to above $1700!
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Please click here now . Double-click to enlarge this daily gold chart. As a former stock broker, I have a lot of experience dealing with investor emotion at key buy and sell zones in the market.
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Bank traders and Chindian gold dealers tend to be price makers more than takers, and that gives them the confidence to buy a falling knife and sell a parabolic move.
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In my professional opinion, most amateur investors should not try to buy a falling knife, even at a major support zone.
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It’s simply too emotionally difficult to manage the investment professionally.
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After a big decline in the gold market brings the price to a major support zone, amateur investors should wait for “signs of bullish life” before they buy.
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That could be an upturn in sentiment, a fresh rally with big volume, an important candlestick, or an oscillator buy signal.
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These technical signs of life allow the average investor to make their purchases in a positive state of mind but still get their gold stock or bullion at a greatly discounted price.
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Please click here now . Double-click to enlarge this weekly gold chart.
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The key support zones for investors are $1466, $1385, and $1350. Gold is now near $1466. That’s a $100/ounce price sale from the $1566 area highs.
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The next step is to watch for technical signs of life; gold investors don’t want to miss out on a rally to $1700, and that could occur soon if big bank analysts like UBS are correct!
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Please click here now . Double-click to enlarge this dollar versus yen chart.
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The dollar’s feeble breakout from the inverse H&S bottom pattern isn’t convincing, and a failure here would be a key sign of life that the gold price correction could be ending.
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Next, please click here now . Double-click to enlarge. Another major sign of life could come from this important “monthly close” gold chart.
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Note the pullback to a key support line. If there’s even a modest rally from here, it could mean a bull flag is in play, and the target of the flag is about $1710!
