Decisions, decisions

So the relative price of gold is at 1.065 times its 200-DMA, down from 1.161 only two weeks ago. It’s been a great run since the last buy point below 1.01: 25 percent for gold and 43 percent for silver in the last six months. The question is, are the Elliott Wave people correct in calculating a drop to sub-300 levels, or not. I’ve done nothing but lose by experimenting with their recommendations, which now expect an immediate short-term uptick followed by a continuing decline.

Now if they are right and there’s a move back up to the 1.15 level (around $432), I may make the tactical sale I missed two weeks ago when I wasn’t paying close attention. Lesson: always punch in the numbers every night! I discovered that my sell point had been hit two days late; not pleased with myself. If it doesn’t come, I’ll wait for the next buy point, which right now looks like $375, and look to ride that wave.

I wouldn’t short stocks now, the Fed being so desperate and irresponsible right now with M3 declining that I wouldn’t put anything past them, but I sure wouldn’t be hanging onto them either. The run since March has been great – another miss for me – but all things must come to an end. Take your money off the table and wait for the next opportunity to ride the wave.