Below I have painted a dotted red line whereby you can short Gold for an immediate term “Trade” – at effectively any price north of $973/oz, the risk associated with being short gold actually goes down, in the immediate term. You can cover at the green dotted line ($927/oz). This isn’t a huge projected return, but it pays for lunch.
I understand and support the bullish case for gold as a safety currency – I have been pitching that for the better part of a year. The intermediate “Trend” line of support for gold is all the way down at $886/oz however, and we need to be mindful of that. I will likely buy it again down there, if I am so lucky to see that price. In the meantime, don’t confuse the hype with the reality of the math. Gold, right here and now, is overbought.
Keith R. McCullough
CEO & Chief Investment Officer