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Gold Continues to Trade in an Ever Tighter range.

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@handofzara
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Gold had a rough day today with an early sell off.

And yet nothing has really changed as thus far the range continues to narrow in what so far seems to be a consolidation after a massive rally.

Almost a month ago I began writing about the massive ROLLER COASTER trading range in gold. But with all ROLLER COASTERS, the ups and downs become smaller and smaller.

The initial trading range in gold was from the HIGH of $2089.20 per ounce posted on August 7th and the LOW of $1874 posted on August 12th.

An initial range of $215.00 per ounce.

Today the trading range has narrowed from the LOW of $1908.40 posted on August 26th and the HIGH posted yesterday (September 1st) of $2001.20.

A current range of $92.80 per ounce.

Silver got whacked BUT the range continues to tighten.

The initial range (during the fun part of the ROLLER COASTER) was $6.33 per ounce. The range has narrowed based upon the most recent low and yesterday's high, and currently sits at $2.95 per ounce.

The miners actually ended the day in the money after a horrific drop early in the session.

The initial trading range for GDX was $6.89 per share and today the range is around $3.52 per share.

So what does this all mean?

Well if you are a stacker, then not much at all since everyday is a good day to buy.

But if you are trading always remember that from tight ranges come BIG moves.

The real trick is to figure out which way that move will be; either up or down.

CAUTION remains the word of the day as the precious metals markets continue to consolidate with very little direction.

The above chart is a longer term view of GDX illustrating how GDX rallied earlier this year and then from early April through late June just traded sideways.

Then BOOM a huge rally from late June through early August.

The market is currently in one of those times of sideways trading. Notice how the Bollinger Bands are almost racing towards each other as the range narrows.

Peace out and stack on.