Gold weak for a second day, is anyone surprised? Gold went parabolic in the last two months: $1,600 to $1,900 in two months? Even professional traders were scratching their heads.
Here's the simple truth:
stocks are notably UNDEROWNED,
bonds are notably OVEROWNED,
gold is notably OVEROWNED...can you say asset allocation?
All you need is a couple days with stocks moving up or sideways — which we are seeing — and some guys are going to start moving money around a bit.
There may be more than technicals at work with gold. The decline in gold today corresponded with the decline in the euro. The Greek bailout — with multiple parties demanding collateral — is definitely more complicated than everyone thought.
There's talk that part of the problem with gold may be that Greece could possibly be required to put up gold as collateral, or may have to sell gold.
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One thing's for sure: these trading patterns are very short-term, which is why everyone has become a technical analyst.
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