Gold's Getting Into the Target Range for Traders

Again, any time along here is a reasonable time to buy physical gold if one is in need.  By the time one pays a markup from a dealer, the impact on the typical retail investor's price points is negligible--you don't want to miss it if it rebounds quickly.

It appears that gold will reach that 1100 range we discussed as the first target.  In reality, we believe it will start seeing buying at it approaches the 50 day moving average, currently at 1101.76.

We are sticking with our previously published buying strategy.  We'll be taking our first paper gold positions today and holding out for a possible short but strong break below the 1100 level in the next few days (no guarantees on this one, which is why we're taking some positions now as gold approaches 1100).

The reason for a possible break to 1070, which we would definitely consider an overshoot to the downside at this time, is because the euro has shown weakness and has bit further to fall, as does the yen.  Meanwhile, there's no central bank on the planet that wouldn't like to take more steam out of the gold price...

Given that we're in a seasonally strong period, however, once gold starts moving up again, we believe it will take off with gusto.  Thus, you're going to have to be quick if you're going to try and grab the bottom.  Instead, we're easing in now and holding some cash for a break below 1100--if it comes at all.

We also really, really like the gold stocks near here.  We'll update this more near the end of the day today.