this may be stating the obvious, but these market commentators expect volatility ahead. with the open interest declining to multi-year lows, and low volume on the futures exchanges, they expect rapid moves up and down.

Dan Norcini, writing on jsmineset.com, saw gold “knifing through one resistance level after another as if they did not exist. It is evident from the ferocity of the climb that the shorts were squeezed in a big way with a plethora of buy stops being touched off in the relatively low volume trading conditions. Here is another example of that lack of liquidity I have been referring to over and over again with the declining open interest creating huge pockets of air both above and below this market. A few well placed orders, either on the buy side or the sell side, and the cascade or upside catapult ensues.”

Tom Pawlicki, of MF Global, sounded a cautious note, saying that, “We’re witnessing risk appetite returning, but it’s more short-term in nature, instead of an initiation of a long-term uptrend … In this environment, where we see Treasury bills at zero, credit markets are the new safe haven, and gold is trading more with riskier assets.”.

http://caseyresearch.com/displayDrp....