Pro: Levels to Watch on Gold

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It's probably the most frustrating trade of this young year: gold.

Between the Federal Reserve, the Bank of Japan and Bank of England in all-out race to debase their respective currencies, you would think gold would be the trade this year. I certainly did.

But alas, that has not been the case. So what to do now?

I'm encouraged by the recent price action in bullion. After some violent moves this past month, it's trading in an increasingly narrow range and forming a very strong wedge pattern. Traders love these types of patterns, because when they form, they typically portend big moves.

Yesterday on Futures Now, Bank of America's MacNeil Curry said that gold appears to be forming some type of base, and that $1,640 is a good entry point for those looking to get long. I agree. (Watch: Full Interview with BofA's MacNeil Curry)

So what's my game plan?

I'm buying any meaningful dip in gold, probably around $1,660. However, should gold break below $1,650, I'd probably look to hold off until a better level.

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