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Bullion Charts and Commentary
posted Apr 23, 2006 at 04:05AM

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In my last commentary on 8 April I wrote,

"Well, if strapped to the chair under a naked light bulb and forced to give an "opinion" on what I think the gold sector is going to do ... Well I think next week will be a down week. I think gold will do some consoidation and retracement of "wave 4" variety. Bullion will then complete a move by heading up to 620-625 whereupon a more significant correction will take place"

Well gold has done that and a bit more. The big question is what next?

Again in the big picture, we see clear indications of the inexorably rising prices one expects to see in a Wave III/Phase II bull market environment. In such an environment overbought technical indicators will be a confirmation of this.

In the short-term, I think we will see some kind of consolidation. What form? I don't really know. It could be a sideways consolidation, or a sharp correction. My own "trading" plan is to be on the sidelines at the start of the week and just watch. The last two weeks saw me not just back in active trading mode, but selling off into pops, some smaller, positions of stuff in the "things" sector.

Mostly money management stuff, I did want to have some extra cash in case the commodity sector decides to take a breather.

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