Comment: This year’s rally, having corrected 38% of last year’s massive collapse, looks set to take a breather. Expect consolidation over the next month or two with the downside hopefully being limited by the lower edge of the Ichimoku ‘cloud’ and the 26-week moving average. Many will probably be hoping that prices hold above the psychological $1000.00 level and, while we cannot promise it will not break below here, we feel these will be brief - mere blips. As to the upside, $1300/1335 is pivotal, having capped in 2006, and much of 2007, as well as being Fibonacci retracement. While unlikely for a few months, a break above here would add significant bullish momentum for a sharp rally to the $1700 area. New record highs are still a very long way out though it should keep pace with the value of spot Gold.
Strategy: Buy at $1150, adding to $1100; stop well below $1000. Add to longs on a weekly close above $1300 for $1475 short term, $1650/1700 medium term, and probably more very long term.
