Bullion's explosive move yesterday was attributed to a few factors, including short-covering, but the bottom line is that bullion futures appear primed to blow the supposed $700 barrier to smithereens. That would be nicely in line with our recent forecast, which was given here earlier in the week as follows: 'There is granite resistance just above, at the confluence of two important Hidden Pivots, 680.60 and 682.00. If the futures jackhammer their way past those numbers, we can confidently infer that they are about to trash the psychologically important $700 barrier with equal aplomb, turning it from resistance into incipient support in mere days.' No question, a jackhammer effect was what we witnessed. The April Comex contract rocketed $20 off its intraday low, pausing precisely at our 680.60 target for all of 20 minutes before making a final thrust to 686.40 to end the day. The relatively shallow pullback in after-hours trading suggested that bulls were fixing to romp once again, warning bears to think twice before taking a stand at $700. Reuters take on the rally evinced the kind of cluelessness that can only embolden buyers: 'U.S. gold futures surged more than 3 percent on Wednesday after a pullback in the previous session, as technical and fund buying, higher oil and geopolitical tensions pushed the precious metal closer to the $700 an ounce psychological mark.' What a bladder-bag of mush! You'd have to be an old-timer to recall the last time 'geopolitical tensions' were cited as a reason for gold's strength. Indeed, the price of bullion seems to have decoupled from world events in the 1970s. Has that link returned? Whatever the case, bulls should take heart in the fact that Gold's biggest rally since June has evidently confounded the business-page scribes. Bullion will be pushing $900 an ounce
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