May 27, 2021 - (Gold Market Wire) - Yesterday's action presents us some small problems, within a generally bullish picture. Our trend line is being maintained, (we have tweaked it very slightly, to reflect today's action out of the East) and we have also maintained the recent horizontal support line, which can be seen in the chart below.

So far, so good. This is a decent picture of a bull market charging along at a nice pleasant pace, without too much acceleration and wild moves. A few gaps to get the adrenaline moving, followed by nice back and fills... and, the resumed charge. Our only facet of concern could be to see Tuesday and Wednesday as a potential reversal pattern. Given the intersection of the trend line and the horizontal, that is going to make today's action (and tomorrow's) highly both interesting and important. If the market can push off that reversal indication, and we're inclined to think that it will, we will have some solid support for a continued run higher.

Make no mistake, the Bulls have the bit between the teeth and are in charge of this market. But the traders love to flush out weak length. That could mean a down draft that 'tree shakes' the weak players out, before resuming the rally. If you are leveraged to the eyeballs, it might be an idea to scale it down a bit, so you don't fall victim to COT - who doesn't want anyone on-board for the next move. Of course, when the weak hands get flushed out and are forced to climb back in at much higher levels, it will be the same COT/Tree Shakers selling to them again (yes, 'rinse/repeat'.)

On the Gold front things are made more positive by our clearing of the major downtrend line, in the chart below.

Notwithstanding the positive aspects of the above chart, we have to admit that the last two weeks in Gold have been fairly 'vertical', and in that sense, some kind of move down could happen (emphasis on the 'could'.) These admonitions stand only as provisos to have a plan, incase a sell-off occurs...and also, a plan to get back in, because we don't really see any sell-off as having any serious legs to it.