While quite a bit of time and research goes into selecting stocks, it is often hard to know when to pull out – especially for first time investors. The good news is that if you have chosen your stocks carefully, you won’t need to pull out for a very long time, such as when you are ready to retire. But there are specific instances when you will need to sell your stocks before you have reached your financial goals.

You may think that the time to sell is when the stock value is about to drop – and you may even be advised by your broker to do this. But this isn’t necessarily the right course of action.

Stocks go up and back down all of the time, dependent on the economyand of course the economy relies on the exchange too. This is the reason why it’s so tough to resolve whether you must sell your stock or not. Stocks go down, but they also have a tendency to go back up.

You have to do more research, and you have to keep up with the stability of the companies that you invest in. Changes in corporations have a profound impact on the value of the stock. For instance, a new CEO can affect the value of stock. A plummet in the industry can affect a stock. Many things – all combined – affect the value of stock. But there are really only three good reasons to sell a stock.

The 1st reason has reached your money goals. When you’ve reached retirement, you may want to sell your stocks and put your cash in safer monetary vehicles ,eg a high-interest account.

This is a common practice for those who have invested for the purpose of financing their retirement. The second reason to sell a stock is if there are major changes in the business you are investing in that cause, or will cause, the value of the stock to drop, with little or no possibility of the value rising again. Ideally, you would sell your stock in this situation before the value starts to drop.

If the value of the stock spikes, this is the third reason you may want to sell. If your stock is valued at $100 per share today, but drastically rises to $200 per share next week, it is a great time to sell – especially if the outlook is that the value will drop back down to $100 per share soon. You would sell when the stock was worth $200 per share.

As a newbie, you definitely need to talk to a broker or a finance advisor before purchasing or selling stocks. They’ll work with you to help make the correct calls to reach your fiscal goals.

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Gold enjoyed a strong August after emerging out of its late-July seasonal lows. But interestingly last month’s bullish action was probably just the beginning of gold’s newest rally. A whole host of bullish seasonal, sentimental, and technical factors are converging that ought to catapult gold much higher in the coming months.

In seasonal terms, autumn is the strongest time of the year for the ancient metal of kings. Big surges in gold investment demand emerge out of Asia. The initial one is post-harvest buying once Asian farmers learn how much surplus income their hard work generated in the latest growing season. They invest some of these savings in physical gold. Harvest time for them is like year-end for Westerners, when we figure out how much money we’ve earned beyond our living expenses.

After that, Indian festival season kicks in. India is the world’s largest gold consumer, and its autumn festival season is considered the most fortuitous time for young Indians to get married. Their culture believes the timing of a wedding affects a marriage’s longevity, happiness, success, and luck. Families of Indian brides spend fortunes to adorn them with intricate 22-karat jewelry. These dowries provide more than beautiful adornment, gold’s intrinsic value helps secure the bride’s financial independence in her husband’s family.

Thus gold’s seasonals are very strong this time of year, so it indeed tends to rally every autumn like clockwork. But seasonals alone are not enough, they are ultimately a secondary influence on gold prices. More important is short-term sentiment and technicals. If gold comes into autumn drenched in greed and wildly overbought, the odds favor it correcting regardless of seasonal tendencies. Thankfully just the opposite is true this year.

Heading into autumn 2010, there has been little enthusiasm for gold and it has lingered far closer to oversold levels than overbought ones. Thus sentiment and technicals favor a big autumn gold rally this year, while seasonals provide strong tailwinds that make gold’s outlook even more bullish. Actually, the sentimental and technical scene today is the best setup for a big autumn gold rally I’ve seen in years.

To flesh out today’s strong foundation for a major gold rally in the coming months, let’s start with technicals and then move into sentiment. Price action ultimately drives sentiment, traders get depressed when prices are relatively low and euphoric when they are relatively high. Despite gold challenging new all-time nominal highs this week, believe it or not this metal is actually relatively low technically!

This chart presents a combination of gold technicals and an indicator I created many years ago called relative gold. Relative gold is rendered in red and slaved to the left axis. It expresses gold as a constant multiple of its 200-day moving average. Graphed over time, this creates a horizontal trading range showing when gold is relatively high (overbought) and relatively low (oversold). If you are not familiar with Relativity trading theory, read one of my essays on it to get up to speed.

On this chart, gold’s recent price levels look pretty darned high compared to the last few years. But amazingly, gold is actually fairly cheap today technically. How? All price action is relative. Back in autumn 2005 for example, when gold first broke over $500 in this bull, that level looked stupendously high. But today this very same $500 level seems end-of-the-world low. Throughout the course of any secular bull, ever-higher baseline prices are the norm. And relative to its latest baseline, gold is cheap.

Gold first broke over $1200 this year in early May, actually on the very day of the infamous Flash Crash. Extreme fear drove a deluge of panicky stock-market capital into the GLD gold ETF. Demand from stock investors for GLD shares was so high that this fund’s custodians had to buy almost 20 metric tons of gold that day to keep their ETF from decoupling to the upside from the metal. This huge 1.7% GLD holdings build drove a 2.8% rally in the gold price, propelling it over $1200.

Since that fateful day just over 4 months ago, gold has averaged $1216 on close. Whenever a price consolidates sideways near highs, it forms a base. And the longer any price level persists, the more traders grow comfortable with it and accept it as the new baseline norm. So $1200 no longer feels expensive, but typical. This is a far cry from the way $1200 was originally viewed in December 2009 the first time it was hit.

Last year’s impressively big autumn gold rally that drove the first $1200 sighting ever is readily apparent in this chart. Some technicians even measure gold’s current base back to those days over 9 months ago. While $1200 felt unsustainably high and risky then, thanks to gold’s subsequent high consolidation this same level merely feels normal today. Gold’s latest $1200+ base is well-established psychologically.

And this behavior is typical. As you can see in this chart, gold tends to consolidate sideways during its summer doldrums. This gives traders plenty of time to grow comfortable with new prevailing price levels. And then once autumn arrives, gold tends to shoot higher on the back of strong global investment demand. This cyclical behavior is very common in gold, only interrupted by the crazy anomaly of 2008′s epic stock panic.

Back in the summer of 2007 (market summers are calendar June, July, and August), gold averaged $662 on close. Yet after its big autumn rally, gold’s monthly average in December shot up 21.8%. Something similar would have likely happened in the autumn of 2008, but that crazy once-in-a-century stock panic drove such staggering levels of fear that it short-circuited gold’s seasonal cycles. Nevertheless, gold made a very fast recovery after the panic and has powered higher in a strong uptrend ever since.

In the summer of 2009, gold again consolidated sideways and averaged $943. It was kind of funny, as late that July this metal’s sentiment was very bearish near its seasonal lows. Most analysts and traders expected a big selloff. But as a contrarian I pointed out at the time that gold was finally poised technically for its long-awaited decisive breakout above $1000. It was basing before a big autumn surge. I was later proven right while the naysayers were wrong, in December 2009 gold averaged $1127 (19.5% higher).

Then in the recent summer of 2010, gold averaged $1215. Between the summers and Decembers of 2007 and 2009, the average gold price surged up in a tight 20.7% gain. If we see a similar autumn rally this year, which is likely, gold will average $1466 in December 2010. Since this is just a monthly average, the odds of seeing $1500 this autumn are actually rather high. And anything above today’s prices is easily new all-time-nominal-high territory, which will do wonders for this metal on the sentiment front.

In relative terms, the odds for such a big autumn rally this year are even better since gold is low in its trading range. Over the past 6 years or so, gold has tended to gradually oscillate in a horizontal range between 0.99x its 200dma on the low side to 1.25x on the high side. Gold is cheap when it is low in this range, the time to be long. Gold is expensive when it is high in this range, the time to be short.

In late July this year at its seasonal low, gold fell so out of favor that it hit 1.015x its 200dma. This is actually very similar to what we saw in August 2007 (0.998x) before that year’s big autumn gold rally. Gold has not been remotely close to being technically overbought or even overextended since way back in early December 2009 when it first hit $1200 (at 1.248x its 200dma). This pattern of starting the autumn rally near gold’s 200dma and ending it stretched 25%+ above this key metric is typical.

Today gold’s 200-day moving average is near $1165. To stretch 25% above it and enter the greedy realm of overboughtness, gold would have to hit $1456. And realize that as gold marches higher in the coming months, this 200dma baseline will gradually rise as well. By December as the autumn gold rally winds down, seeing gold overbought at 1.25x its 200dma could very well be at a price around $1500.

So in a pure technical sense, gold is looking very bullish today. Despite being near all-time nominal highs, it isn’t overextended at all. $1200+ gold is the new norm, first seen in December 2009 and enjoyed continuously on average since early May. Gold is entering autumn near the bottom of its relative trading range, not far above its 200dma. It will take a lot of buying, and the resulting rallying, to drive this metal back into the overbought territory at the top of its relative range.

Once again, price action drives sentiment. The reason traders aren’t very excited about gold today is because it essentially hasn’t made any progress since either May or June (when $1256 was first hit), depending on one’s perspective. While sideways consolidations generate comfort with and acceptance of new prevailing price levels, they never spawn any excitement. Consolidations bore traders into apathy.

Given today’s overwhelmingly apathetic sentiment, traders’ near-term outlook on gold has a long ways to improve. And the only thing that can do it, start to bring back excitement and eventually greed, is for gold prices to continue rallying higher. Gold surged 5.5% in August, which certainly made a favorable impression on many traders’ radars. As this rally continues, gold will break into super-important psychological territory.

In real inflation-adjusted terms, January 1980′s all-time gold high was around $2400 in today’s dollars. So gold isn’t even close to a new real high yet. But few think in real terms, so the headline nominal price is all that matters psychologically. And gold is right on the verge of heading into new all-time-record-high territory in nominal terms. It first hit $1256 in mid-June, so anything materially above this will represent new all-time highs. Traders and the media love new highs.

All-time highs in any asset draw a lot of attention to it. The media reports on that asset excessively and tends to extrapolate its strong performance forward. Countless traders who weren’t interested in the asset before get really excited about new record highs and start chasing the momentum. They deploy capital, which drives the asset even higher, getting still more traders interested. Thus new all-time highs often form a virtuous circle where favorable psychology drives expanding buying which feeds on itself.

The $1300 gold coming soon is going to be big mainstream financial news. $1400 will be even bigger. And when we hit $1500, this nice round number will make record gold highs mainstream general news. Realize all this gold excitement will be multiplying at a time when individual investors remain scared of the stock markets and cowering on the sidelines in record amounts of cash (literally trillions of dollars). If even a small fraction of that starts chasing gold, we’ll see a massive spike well beyond the usual big-autumn-rally standards.

Anecdotally, in my little physical world I’m amazed how many people I come across that are getting really interested in gold for the first time. At Zeal we and our subscribers have already made fortunes in this bull, starting to buy physical gold coins in May 2001 ($260s gold) and riding the epic rally in precious-metals stocks ever since. So gold is certainly no longer new to contrarians like us who have been investing in this secular bull for a decade.

But this metal is still new to most, an asset the great majority of mainstream investors have yet to touch. New record gold highs during today’s anxious stock-market environment will really accelerate new-gold-investor creation. Mainstream investors are not contrarians, they never buy near lows when things are out of favor and cheap. Instead they wait for highs, piling in to chase momentum. And new record gold highs contrasted with their limp portfolios hobbled by pathetic zero-yielding cash will prove very enticing.

And of course if gold rallies big this autumn, the precious-metals stocks should rocket up and leverage its gains. Despite recovering strongly since the stock panic, as a sector PM stocks remain very undervalued today compared to prevailing gold prices. So not only are PM stocks almost certain to surge strongly with new gold highs, but they have a lot of catching up to do yet before they even reflect today’s levels. Thus the prospects for PM stocks this autumn are simply dazzling.

The bottom line is gold looks incredibly bullish heading into autumn 2010. Its big seasonal investment-demand spikes out of Asia are just starting to ramp up. And it is entering its strong season at relatively-low levels technically in an apathy-filled environment. Any rally at all will push this metal to new all-time nominal highs, which will really improve psychology and accelerate capital inflows into gold.

And this big autumn gold rally is happening while investors are scared of the stock markets and sitting on mountains of cash doing nothing for them. There couldn’t be a more opportune time for the media to get fixated on new record gold prices, driving investor interest. While the metal’s gains should be excellent, they will be easily dwarfed by those in the long-out-of-favor precious-metals stocks.

Learn how to buy gold and make great money doing it! Gold is the best investment in ANY economy!

Last week’s articles focused specifically on the option Greek Theta. This week we will shift gears and adjust our focus on Delta, another fundamental tenet of option trading. The official definition of Delta as provided by Wikipedia is as follows:

Δ, Delta – Measures the rate of change of option value with respect to changes in the underlying asset’s price.

Delta has a significant impact on the price of an option contract(s). When a trader is long a call contract, Delta will always be positive. Likewise, if an option trader owns a put contract long, Delta will always be negative. As option contracts get closer to the money their Delta increases causing the option contract to rise in value rapidly as the option gets closer to being in the money.

Clearly Theta has an adverse impact on a trader who is long a single options position (own options long with no hedge or spread), however Delta is extremely dynamic and is one of the major factors directly responsible for option pricing as the price of the underlying changes throughout the trading day.

If an option is deep in the money, the option contract will have a higher Delta and will generally act similarly to actually owning the individual stock. For a deep in-the-money GLD call that has a Delta of +.80, the first dollar GLD rises by then the value of the GLD call options increases by roughly $0.80 or $80.

If the delta is 0.80, this essentially means that the GLD call option will increase in value 0.80 ($80) for every $1 that the GLD ETF increases. As the GLD option goes deeper into the money, the Delta will typically rise until it nearly produces the same gains as the GLD ETF until the delta asymptotically approaches 1.00 and the option moves in lockstep with the underlying. While my next article will continue to help explain Delta, it is important to understand how Delta can enhance a trader’s return when trading options with a specific directional bias.

While options exist for the gold futures contract, typically if I want to trade gold I utilize the GLD ETF. The primary reason is that the ETF offers liquid options, which makes it easier to initiate spreads and multi-legged orders. If options are thinly traded, the bid ask spread is almost always wide making it more difficult to get a good fill and a good overall price. Most option traders stay away from underlying stocks that have illiquid options.

In order to better illustrate how an options’ Delta can create profits, I will use GLD as an example. Keep in mind, I am not advising any traders to buy or sell options naked. I only trade options using strategies that help mitigate various risks to my capital. Theta (time) risk, volatility risk, and market risk are not being considered as this is merely an example to illustrate the power of Delta.

Recently Gold and subsequently GLD suffered a pretty significant pullback. GLD broke down through a major horizontal trend line and the daily chart was extremely bearish. Just when a lot of traders were preparing to get short GLD, buyers stepped in and pushed GLD’s price back above the support area. The GLD daily chart listed below illustrates the breakdown and subsequent failure and a powerful rally followed.

Let us assume for contrast that an option trader and an equity trader each want to get long GLD. The equity trader buys 200 shares of GLD at $115/share. Assuming the equity trader does not use margin, the total trade would cost around $23,000 not including commissions. The option trader decides to utilize delta and purchases 5 October 107 calls which in our example cost $900 per contract for a grand total of $4,500 not including commissions.

We will assume the October 107 calls have a Delta of 1.00. When a call option has a delta of 1.00, it essentially means that the owner of the call is going to get 100% of the move reflected in the premium of the option he/she owns. Thus if GLD increases by $1, the value of the option would increase $1 all things being held constant.

This is where Delta really shines; it shines even brighter than gold in this illustration. Both the equity trader and the option trader have a profit target of $118/share. A few days later GLD reaches $118/share and both traders close their trades with profits. The equity trader made $3/share which relates to a total gain of $600, or around 2.60%.

The option trader realized roughly 95% of the move, meaning around $2.85. The option trader had five total contracts for a total gain of $1,425 less commissions. The total gain for the options trader was over 31% less commissions.

Keep in mind, the option trader only had $4,500 of maximum risk while the equity trader was risking over $20,000. The option trader made over 100% more money, while risking only 25% of the total capital required by the equity trader. Behold, the power of Delta!

Learn how to buy gold and make great money doing it! Gold is the best investment in ANY economy!

MONTREAL, Quebec, Canada, January 21, 2011 – Richmont Mines Inc. (TSX – NYSE Amex: RIC), (“Richmont” or the “Company”) is pleased to release 2010 gold sales figures, to provide guidance for gold production levels in 2011, and to update its reserve and resource calculations as of December 31, 2010.

Highlights:

2010 gold sales of 68,123 ounces, up 14% year-over-year and 5% above forecasted 65,000 ounces; Q4/2010 gold sales of 18,591 ounces, a 43% increase over Q4/2009 gold sales of 13,029 ounces; 2011 gold production forecast of 80,000 – 85,000 ounces; Total Proven and Probable reserves of 366,944 gold ounces at December 31, 2010 versus 445,471 gold ounces at December 31, 2009; Updated Wasamac property resource calculation including pending results from the 20,000 metre drilling campaign in 2010 expected to be available by mid-February 2011. 2010 gold sales overview

On a consolidated basis, Richmont Mines sold 68,123 ounces of gold in 2010, a notable 14% increase over 2009 sales levels of 59,733 ounces of gold, and 5% above the Company’s targeted level of 65,000 ounces of gold for the year. On a segmented basis, the Island Gold Mine contributed 45,865 ounces of gold in 2010, 18% above 2009 levels, while the Beaufor Mine sold 22,258 ounces of gold in 2010, up 7% over the prior year’s levels.

Richmont Mines plans to release its fourth quarter and full year 2010 financial results during the week of February 21, 2011.

Forecasted 2011 production

The Company is expecting annual gold production of 80,000 – 85,000 ounces in 2011, reflecting forecasted production of 45,000 – 50,000 ounces from the Island Gold Mine, 20,000 – 25,000 ounces from the Beaufor Mine, and 15,000 ounces from the Francoeur Mine, of which 5,000 ounces will be produced prior to the start of commercial production, expected in mid-2011. For 2012, with a full year of production from the Francoeur Mine, the Company expects annual production to exceed 100,000 ounces of gold.

Updated Reserve and Resource Estimates

Island Gold Mine

As of December 31, 2010, total Proven and Probable Reserves at the Island Gold Mine were 161,197 gold ounces. Proven and Probable reserves declined from 264,085 gold ounces at the end of December 2009 primarily as a result of three contributing factors:

(1) 12 months of production at the mine;

(2) Results from definition drilling in 2010 that lowered Probable reserve estimates in the Lochalsh Zone;

(3) Reconciliation between actual production and reserve estimates, due to lower than anticipated amounts of gold being recovered from several blocks as a result of more variable gold distribution in the alteration zone.

Estimated Measured and Indicated resources at the Island Gold Mine increased to 188,511 gold ounces at December 31, 2010, versus 154,813 Au ounces last year, as drilling efforts throughout the year enabled the Company to successfully convert Inferred resources to Measured and Indicated resources. Estimated Inferred resources at December 31, 2010 decreased to 138,732 gold ounces, versus 199,569 gold ounces at the end of December 2009.

On a positive front, drilling in 2010 resulted in favourable results at depth, between -400 and -900 metres elevation, specifically:

These results confirm the extension of the Island Gold mineralized zones at depth over a lateral distance of more than 1 km. Please see the Island Gold longitudinal section below.

Figure 1: Island Gold longitudinal

http://media3.marketwire.com/docs/maps1.pdf

A total of 38,000 metres of drilling are planned for the Island Gold Mine property in 2011, of which 30,000 metres will be underground exploration and definition drilling and the outstanding 8,000 metres will be surface exploration drilling. A primary focus in 2011 will be to better define the gold resources potential at depth.

Beaufor Mine

Proven and Probable reserves at the Beaufor Mine increased to 68,998 gold ounces at December 31, 2010, from 44,637 gold ounces at December 31, 2009. This reflects the addition of 24,798 ounces of reserves identified through the drilling program on the near-surface W and 367 zones, in conjunction with reserves established within the mine’s existing underground infrastructure as a result of definition drilling in 2010, offset by 22,258 ounces of gold sales from the mine in 2010.

Drilling efforts in 2010 similarly resulted in a minor increase in Measured and Indicated resources to 173,453 ounces at the end of 2010 versus 171,372 ounces at the end of 2009. Inferred resources declined slightly to 182,185 ounces as of December 31, 2010 from 199,256 ounces at the end of the prior year. Existing resources are mostly below the existing infrastructure of the mine, and currently do not economically justify an extension of current operations.

The Company is planning 11,000 metres of definition drilling and 17,000 metres of exploration drilling at the Beaufor Mine in 2011, in an effort to continue to grow its reserve and resource base. The primary focus will be to expand and advance the potential of the near-surface W and 367 zones, located to the west of the mine’s existing infrastructure.

Francoeur Mine

As of December 31, 2010, the Francoeur Mine had total estimated Probable reserves of 136,749 gold ounces, unchanged from year-end 2009 and similarly unchanged from results detailed in the 43-101 compliant technical report, filed on SEDAR on August 5, 2009. Indicated Resources of 18,541 gold ounces and Inferred Resources of 38,706 gold ounces for the Francoeur Mine also remained unchanged from previously published levels. The mine is scheduled to begin production in mid-2011, with an annual estimated production rate of 35,000 Au ounces for an initial mine life of four years.

Wasamac Property

The Wasamac property had Inferred resources of 285,200 gold ounces as of December 31, 2009. An updated Resource estimate as of December 31, 2010, incorporating pending results from the 20,000 metres of drilling that was completed on this property in 2010, will be released by mid-February 2011.

About Richmont Mines Inc.

Richmont Mines has produced over 1.2 million ounces of gold from its operations in Quebec, Ontario and Newfoundland since beginning production in 1991. With extensive experience in gold exploration, development and mining, the Company is well positioned to cost-effectively build its North American reserve base through a combination of organic growth, strategic acquisitions and partnerships. Richmont routinely posts news and other important information on its website (www.richmont-mines.com).

Forward-Looking Statements

This news release contains forward-looking statements that include risks and uncertainties. When used in this news release, the words “estimate”, “project”, “anticipate”, “expect”, “intend”, “believe”, “hope”, “may” and similar expressions, as well as “will”, “shall” and other indications of future tense, are intended to identify forward-looking statements. The forward-looking statements are based on current expectations and apply only as of the date on which they were made.

The factors that could cause actual results to differ materially from those indicated in such forward-looking statements include changes in the prevailing price of gold, the Canadian-United States exchange rate, grade of ore mined and unforeseen difficulties in mining operations that could affect revenue and production costs. Other factors such as uncertainties regarding government regulations could also affect the results. Other risks may be set out in Richmont Mines’ Annual Information Form, Annual Reports and periodic reports.

Regulation 43-101

The reserve and resource calculations as of December 31, 2010 and December 31, 2009 were performed by qualified persons as defined by Regulation 43-101. Please refer to the SEDAR website (www.sedar.co) for full reports and additional corporate documentation.

This press release was reviewed by Mr. Daniel Adam, Geo., Ph.D., Exploration Manager, a qualified person as defined by Regulation 43-101, and an employee of Richmont Mines Inc.

The exploration program was conducted by qualified persons as defined by Regulation 43-101. Specifically, the program was overseen by Mr. Michel Plasse, P.Geo., Chief geologist of the Island Gold Mine, a qualified person as defined by Regulation 43-101, and an employee of Richmont Mines Inc. The analyses were conducted at the Swastika laboratories (2008) Ltd in Swastika, Ontario, by means of fire assay fusion with atomic absorption (AA) and gravimetric finish.

Cautionary note to US investors concerning resource estimates

Information in this press release is intended to comply with the requirements of the Toronto Stock Exchange and applicable Canadian securities legislation, which differ in certain respects with the rules and regulations promulgated under the United States Securities Exchange Act of 1934, as amended (“Exchange Act”), as promulgated by the SEC. The reserve and resource estimates in this press release were prepared in accordance with Regulation 43-101 adopted by the Canadian Securities Administrators. The requirements of Regulation 43-101 differ significantly from the requirements of the United States Securities and Exchange Commission (the “SEC”).

U.S. Investors are urged to consider the disclosure in our annual report on Form 20-F, File No. 001-14598, as filed with the SEC under the Exchange Act, which may be obtained from us (without cost) or from the SEC’s web site: http://sec.gov/edgar.shtml.

Learn how to buy gold and make great money doing it! Gold is the best investment in ANY economy!

The past week has been interesting to say the least. Gold is trying to find support while the SP500 grinds its way higher. Let’s jump into the charts and analysis to get better feel for what I feel is happening here.

Gold 4 Hour Chart As you can see from the chart below gold has formed a possible double top. The fact that it made a higher high is actually a bearish sign for the intermediate term 1-3 weeks. When we see a higher high getting sold into with big volume it typically means the big money is unloading large positions into the surge of breakout traders and short covering that occurs when a new high is reached. Following the big money is very important to keep an eye on as it can warn us of possible trend changes before it occurs.

The current selling volume is not exactly a healthy sign if you are looking for higher prices in the near term. If this pattern breaks down I would expect $1340 to be reached very quickly.

Keep in mind gold it in a strong up trend still. Shorting is not the best play in my opinion. I prefer to see pullback which washes the market of weak positions then jump on the long side for another bounce/rally.

SP500 Market Internal Strength – 10min, 3 days chart I watch these charts to get a feel for the overall market strength on a short term basis. The top chart shows the SPY etf breaking above a resistance trend line on Friday afternoon. This occurred on light volume meaning it is mostly likely a false breakout and Monday we could see a gap lower at the open or a pop & drop. The two other indicators are reaching an extreme level which normally tells us a pullback is due in the next 24-48 hours of trading. The question is, will us just be a bull market pause or will we get a decent pullback.

The red indicator in the top chart and the red indicator levels on the charts below that help us time the market as to when profits should be taken or to tighten our stops if we have any long positions.

The broad market is still in a very strong uptrend so moving stops up and buying on oversold dips is the way to play it.

Weekend Market Analysis Conclusion: In short, both gold and the stock market are in a bull market (uptrend). Trying to pick a top to short the market is not a good idea. Instead I am looking for an extreme oversold condition to help reduce downside risk before taking a long position.

The overall strength of the market (SP500 and Gold) I think are starting to weaken but in no way am I going to short them. We continue to buy dips until proven wrong because indicators can stay in the extreme overbought levels for a long period of time. Generally the biggest moves happen in the last 10-20% of the trend.

Learn how to buy gold and make great money doing it! Gold is the best investment in ANY economy!

If you are a beginner inside the for ex markets, this piece ought to help clear up several things. for-ex markets may be daunting in the beginning, but when you know how it works it’s not.

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