Thursday, gold was under pressure but did make an attempt at a rally. Gold did get positive for a few minutes before closely marginally lower for the day. The action is exactly what we called for, which should lead a period of consolidation.

The action in Gold and Silver is bullish and should lead to much higher prices, although a period of consolidation would make the pattern more bullish. The straight rally from Wednesday needs to resolve itself by pulling back.

Gold should see a sell off to support at 1500 before resuming the rally. We are expecting a run to the 1600 level and possibly higher. Silver should pullback to 1650 before taking a run at 18. We expect the next move in Silver to be bigger than the rally in Gold to reduce the ration between the two.

Todd Horwitz
Chief Strategist