Gold dropped 5 % today, as Ben Bernanke's remarks to Congress damped speculation of more quantitative easing. Gold trades somewhat under 1.700 USD now, close to the 200 day average at 1.675.
Sit back a moment. This means no more inflation? Rising interest rates? Solid financial polity? Solid monetary policy in the US and Europe? So paper money will gain in value in future?
Count the 'NO'-answers you gave mentally to these questions. 3 'NO' or more? Maybe you should watch the GLD closely during the next few days. Also watch the physical demand, and not the value of paper gold only.
If GLD stays above the 200 day average or recovers from a drop below, I would say this would be a good time to initiate a position or add to a position.
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