Explosive rally today in the market, but gold closed down 20 bucks or so.
Clearly, the market was oversold last week and the bounce shouldn’t come as a surprise to too many people who follow this stuff very closely. Timing is always tough to predict but this rally was overdue.
Why is gold being held back right now?
Typically, the fall is the time for gold to head up. There are a few reasons we are seeing gold remaining relatively steady in price.
1) The $850 billion the government pledged for the bailout has not been printed yet. Once that hits, we will have inflation, and gold will undoubtedly rise.
2) So far, gold jewelry buying has been down this season
3) The Plunge Protection Team (PPT) is doing everything it can to keep the price of gold suppressed. This won’t last, as the market direction (bull) will win out in the long run.
There is a shortage of gold bullion right now and orders are taking weeks and even months to fulfill.
If you have any cash right now sitting around, BUY THE DIPS when it comes to gold. Talk to me in January, and you will no doubt be pleased that you did.