First off, I want to say that the plan explained by Steve Hochberg in the video associated with the previous post (free sign up required) meshes well with how I see gold currently.  The 1000 +/- level is very doable, folks.  Not a given, but quite doable.  That would close out investors’ fear from 2008 by having made a completed cycle on the rebound in greed.

In the short-term, gold was probably ready to bounce even before the war stuff hit the news yesterday.  Sentiment had become just deplorable, with gold bulls puking left and right.  The geopolitical thing is a negative, as it always is but the Hulbert HGNSI is quite a positive, as the gold timer community (ha ha ha…) plummets well into net short territory.

So, geopolitical aside (and I always take that seriously as a negative for gold because it gets the worst of the gold “community” back to pumping) gold can see some decent rally activity off of sentiment and the improved Commitments of Traders structure.  But I think more downside may follow over the next few months.  Then?  Cyclical bull.

Meanwhile, I am using gold as a macro tool; probably the best macro tool I have when comparing it to other assets that are positively correlated to economies.  Gold is just a tool around here after all; a tool for market evaluation and a tool for monetary value.  It’s not an idol.  When the ones who obsess about gold with wildly glaring eyes are back on the pump, take caution.

Separately, also at MarketWatch we see that the word is getting out that these ‘golden’ and ‘death’ crosses that inexperienced TA’s often get hysterical about are indeed opposite to the hype.  The supposedly bullish golden ones are more bearish than the death ones.  Too funny, and sadly all too true.

What I like about market management is that there is no shortage of bullshit out there to decode and debunk, but casual observers tend to take it seriously.