RE: RE: RE: 200 dmaYou are certainly right that a rout could happen (as PM-investor you have to know that´s always a possibility). But for me it´s a case of balancing the probabilities. If we are in a gold upleg like 2005/2006 and 2007/2008 (and the charts indicate that we are in a powerful upleg!) then a rout is neglectible. Nevertheless if you can´t stand (or don´t want to take) the risk hedging is probably a good thing.
I think we will test the 50 dma of gold in the time frame of the next two days (wednesday is "fed-day") and it is possible that a fake breakout ($ 1.075 or so) occurs, but then I think it´s buying and not hedging time.
But again it´s all about probabilities and probabilities are depending on the eyes of the particular observer. The charts are telling me it´s a decision point and I am pretty sure (you are obviously not!) we will go up not down, so I won´t hedge this time around. If I am right in this case FR will perform very well and we will benefit handsomely! It´s about time...
GLTA
F