Wednesday, March 9, 2011
Gold This Morning: Be Right & Sit Tight --Jon
Overnight trade was scrappy for the most part marked on the downside by a swoon down to $1423.20 with a trading pattern either initiated by Joe The Plumber or Charlie Sheen; it was that erratic. Anyone lying in wait for this move just after midnight and heard the the siren's enchanted call was well-rewarded and we are now aggressively $10 bucks higher. The facts remain compelling....GSR slightly elevated at ~39.60 begs one to cannonball into the sea of liquidity...RSI on yesterday's reversal is a tick easier ~65 and provides elasticity to the move...gold open interest as of Monday was down ~3,000 contracts and reinforces that the masses are hardly storming the barricades to get at gold. In fact yesterday I read an article citing Shayne McGuire, head of global research at the Teachers Retirement System of Texas, that stated pension funds currently devote .15% of assets to gold...indeed a mere drop in our tidal liquidity. Today: several days of diffident trade lull one into a sheepish position so let's set a modest target to reestablish levels around the prior highs in the $1440s.