Emboldened by the growing obviousness that Quantitative Easing will be held in place more or less forever (QEF!), gold is moving with greater ease and confidence than we’ve seen in quite a while. I’ve been cautiously optimistic in recent days, holding to a 1350.10 target for the December contract as a minimum upside projection for the short-term.  Yesterday’s $33 rally came with $6 of that number, and gold bulls should feel most encouraged by the way it played out. The first stage of the rally was a $26 surge that lasted about 30 minutes.  It was the  kind of take-no-prisoners short squeeze that would have left bears off-balance and ill at ease.  Then, after a brief pullback of about $12, the bad guys were under assault once again from a wrenching, $18 climb that peaked at 1444.70. They were still on the ropes eight hours later when we went to press, with the futures reluctant so far to give up any more than $5 of the afternoon’s gains.

Unlike so many promising rallies in gold that have cooled too quickly, this one deserves high marks for its seeming sustainability. The price action noted above is the reason for this, but you can see it in graphic form in the chart (inset).  At this point, the 1350.10 target should be viewed as a lead-pipe cinch.  However, if it’s easily exceeded on the first try, we could confidently adjust our sights higher, to a 1475.60 Hidden Pivot target noted in an update that went out to subscribers Tuesday morning. We’ll get a good read on the accuracy and reliability of this target once we’ve seen how the December contract interacts with its 1363.30 sibling midpoint. 1475.60 will become my minimum upside target once 1363.30 has been exceeded by more than $1. If that last number shows little stopping power, bulls can assume that the wind is at their backs.