Gold's Direction - Chop Chop Chop

Gold appears to be in some type of consolidation pattern with cloud support underneath in the $1230 range.

The gold miners, as shown by the ETF GDX, also are moving sideways.

While a pullback in the stocks is quite possible soon, note the moving averages on the rainbow chart.

They are tightly compressed, suggesting strong support in the 23.5 to 24 area.

Furthermore, sentiment toward the stocks remains rather neutral if the commercial net short number is any measure.  It currently is under 128,000, which is only slightly higher than it was in December at the lows.

Therefore, we expect that despite headline driven volatility, and Fed reserve members jawboning about interest rate increases, that both the metal and minors have limited downside at this time.

This is a difficult market in the sense that it is choppy, and requires us to either stay on the sidelines, or hold with strong hands.