Financial Advisor

The long-awaited gold correction could be starting now

From Gold Stock Trades:

... As I wrote in my buy signal in gold in late July, the conditions were ideal for a major move to the upside. Now, the conditions are reaching the extreme opposite: it’s overbought, and surpassing measured moves and upper resistance lines, which mark prior turning points.

The majority of traders become reckless at extremely overbought levels and are often stuck when markets correct to find support. They abandon their methods as their accounts grow in value and don’t factor in how events may change.

Right now, gold is the easy trade, as most of the reports from the media outlets are bullish for gold and silver in light of the second round of quantitative easing (QE2), but is it the prudent trade?
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