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Too Much of a Good Thing Results in Corrections

The gold market had one of the wildest days of the year. I think it was a hundred-dollar range from high to low, and it did go crashing down.

When we look at the weekly chart of closes, you're well over that. So your bias is to the upside, you're looking to be a buyer. When we take a look at the daily charts, all right, you've hit your upside counts. I just got to tell you that there are many ways to do this in the chart, but suffice [it] to say, that you could just be looking at this flipped over from this point, which was $2050 to basically down here $1950. It takes you up to a $2150 number. 

But you got to be careful when you look at all these – let's go to the next day because of what happened. The key moving averages, the trend is up. The bias is up. You're still over the 18-day average. However, is the trend up? What defines a trend is higher highs, higher lows...

Let's look at today's action. You went from $2152 to $2038, you took out the prior break low. You now do not have an uptrend, you have a higher high and lower low. You've gone to neutral and boy, what a range. Tell me you see anything like that on the charts prior to this and I think we'd both be laughing – you don't.  And you can see what the market did. Why did this occur? 

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