I can see as high as $703, basis June, but we’ll get to that in a minute. First let me mention that subscribers who followed my advice to-the-letter could have caught one heckuva ride in gold yesterday, having boarded the June Comex contract Sunday evening, just as it was lifting off the launcher.  Here’s the actual recommendation, exactly as it went out on Thursday at the start of the three-day weekend:

+  $ June Gold (610.00)
04/13/2006 18:34:33 EST
A 605.70 print would create a robust new impulse leg of minor degree. Although I don't usually advise buying breakouts, this one is subtle enough that we can try. Accordingly, I'll recommend buying a single contract using a 605.70 buy-stop with a 605.90 limit. Place a stop at 603.90 thereafter, and let it ride. My minimum rally projection for the near term (i.e., the next 4-6 days) is still 624.60.

Long-time subscribers will know that we seldom buy stuff on-the-fly, preferring instead to initiate positions at trend swing-points. But, as noted in the instruction above, this particular entry strategy was based on a signal subtle enough that we went into the trade optimistic about avoiding the mooing herd. And so we did, evidently, for the futures never looked back after touching our buy-stop at 605.70; nor did we even once feel jostled by  the kind of evasive maneuvers that trading vehicles take when too many traders with the same idea are on board.

As bullion continued to move higher on Monday morning, I put out additional instructions that would have allowed longs to exit June Gold near the intraday high, as follows:

(Click on text to enlarge)

By entering the trade on a Sunday, we avoided a problem that has challenged us for some time as we’ve sought to stake out bullish positions in Newmont Mining and some other precious-metal stocks. To wit, shares in the miners have been opening on gaps nearly every day, making them relatively less attractive for belated purchase. In this instance, though, we acted ahead of the gap by jumping on the underlying commodity itself -- just as it was starting to move.

Will the rally continue? Very likely, yes. But you should keep prominently in mind the 624.60 rally target that I advertised here a few weeks ago for the June futures. It looks to me like a potentially daunting obstacle – one that could send gold into a correction phase lasting for at least a couple of weeks. If, on the other hand, the hidden pivot at 624.60 is decisively penetrated within an hour of first being touched, it would strongly imply that sufficient demand remains to push the June contract to as high as 657.20, or even to 703.00, over the next 3-5 weeks.