Readers will recall that I called the big up move in gold in mid-January. Now, everyone’s on board. I can’t find a negative word on gold anywhere. Two months ago, you couldn’t find anything positive. How the worm turns.
ll this positivity is making me nervous. Trees do not grow to the sky, as they say. And the first rally out of a long bear market, while always impressive, has to correct. To me, a 20% move from the low for gold looks about right and that’s where we are now. I think we are due for a sharp, short pull back in gold— maybe $30-$40 dollars–which will temporarily hit the gold stocks hard. So, time to lighten up a bit, particularly in my better ideas like CDE which has doubled since I recommended it. CDE is still a buy longer term, in my opinion, just not today.
Selling is good for the soul. You can always buy it back. Or if it has got away from you, there is always another one that hasn’t moved as much. Today, I’m a seller. You don’t go broke taking profits. But please keep a core position in gold. This is a bull market after all, and the surprises will therefore be to the upside.