GOLD prices fell more than 1.6% overnight to the lowest level in more than a week as a string of better than expected U.S. financial data saw investors price in a higher probability that the Federal Reserve will begin to taper stimulus at its next meeting later in September. Our long positions accumulated at $1,280, $1,320 and $1,400 have all been closed over the past week as gold traded around $1,400.
Most positions were closed when gold first broke below $1,400 on a stop loss basis. Those stop loss triggers were implemented on the initial break of gold above $1,410 to protect profits and has worked out well for us. The current sell down is probably excessive but we remain sidelined for now. However, we will aggressively buy around the $1,320 level if gold does fall to that level. We are neutral in the short term but remain bullish in the medium term.

Compass Direction

Short-Term              Medium-Term

NEUTRAL                BULLISH

Gold

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