The parabolic rise in gold over the last two weeks is continuing as we see price keep firmly above $2,000 in a move to fresh highs of $2,044 in European morning trade.
As much as gold is an attractive proposition given current market conditions and its sound fundamental prospects as a long-term investment, the buying has been unrelenting.
The near-term chart shows that buyers are firmly in control still, after holding on to several tests of the 100-hour moving average (red line) in previous days.
That led to buyers pushing the agenda for a move above $2,000 and they haven't really looked back since. Lower Treasury yields may be a factor but there is a sense that gold is squeezing out a final stretch of gains before a potentially violent pullback.
Granted, there a million and one reasons to stay long gold and we can surely expect dip buyers to enter, but nothing ever moves in a straight line in the market.
When a trade starts to turn into an extreme consensus trade, there is a sense of fear that positioning may be too crowded and that's when pullbacks tend to happen.
As much as I am a gold bull, buying at these levels is a risky proposition. I'd much rather build on further longs on any major pullbacks down the road.