Gold at a Crossroads…”The problem is, none of these stop gap methods do a single thing to address the ROOT CAUSE of the economic slump. All they do is to delay the day of reckoning.”
By: Dan Norcini
GoldSeek.com
Thursday, 13 August 2015
Gold has had a nice run off the Chinese yuan devaluation news with short covering the dominant reason behind the buying.
Markets that have a decent sized speculative short position are always subject to bouts of sharp price rises as shorts scurry for cover. The question is not whether or not shorts are covering – they are. The question is, “Are there large numbers of specs who are willing and eager to assume NEW LONG positions?”
For without that, the rally has no staying power but will fizzle out once the weaker-handed shorts are run out.
Typically, when looking over a market that is experiencing a bout of short covering, one can see it show up in the VOLUME. Volume speaks to emotion and nothing moves markets like FEAR ( if there is any doubt about that, you should look at the volume of trade done in the corn and the beans today as the USDA report touched off a PANIC among longs).
The Rest…HERE
