I have mentioned previously that watching the overnight Asian buying in Gold is an important indicator of future trends. The cyan line is Jan 12, and as you can see highlighted in Yellow Asian buyers were no coming into gold with much force. I expected that this meant this move about 1380 might not last. A nice bull trap occurred as the North American markets started opening.
This does not mean gold can run up again, but right now being a bit cautious might pay off. There are many junior mining companies that look like deals compared to their last month performance however, a correction back to 1350 and even 1300 could be in the works. The USD looks poised to make a run and if this occurs commodities around the world will fall, however, the world has wised up to commodities prices in general and by the end of 2011 there is no doubt gold should have at least touched 1500 and if any major events occur gold 2000 is not just a pipe dream. Look at Silvers move this year, if this is the beginning of a run past $50, pay attention to the silver mining companies profits over the next 6 months.
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