Gold Isn't Out of the Woods Yet Despite Thursday's Strong Rally
NEW YORK (TheStreet) -- A bit of a strange week for markets and many stocks as they looked strong and should have moved but they didn't do much in the end.
Maybe it had something to do with the quadruple witching Friday.
It certainly wasn't fun to be in front of the screens with little really happening, but the good news is that many fast-moving stocks are now ready to go, and I will be on them this week if they do.
As for gold, it had a spectacular move Thursday that saw it breach the very important $1,300 level on massive volume.
I'm really not too sure why the move came, but as I often say, a move comes before the news.
I'm still not so sure gold is done falling, but it is off to a great start.
Let's take a looks at the charts.
Gold didn't get the so-called "blood in the streets" moment of panic, which I am looking for to really cleanse the market of weak hands. Nevertheless, Thursday's move is a great start. Many people are now calling the bottom in, and they may well be right. If it's true, gold has a long way to run higher and will give us many setups in the weeks and months ahead, so I'm not so eager to jump in yet. The $1,340 area looks like it will be a buy level after a small consolidation. The mining shares led gold this week and they were the tip-off that gold was going to move, but who knew it would be such a strong move? I have to admit I fell into the trap of being stuck in a conviction. I talk all the time about not being biased and being able to change my point of view quickly, but this time I fell prey to this rookie mistake. I saw the shares moving and told members to keep an eye on them and a few select stocks, and had I not been so pig-headed, we could have made a killing with the main ETF I had as a setup. It moved more than 20% on Thursday alone. It won't be the last time I get stuck in a conviction. This trading game is always a learning and humbling experience. Let's see what the week ahead brings as it will tell the tale of whether gold has changed trends or not.
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