The gold spot is reaching the lower band of my target from $610 to $685 while HUI is very close to 300 now, a good support level. Assuming that precious metal markets are in a bull market, I believe that this is a good entry point for anyone who has no positions in this sector. The downside risk should be small, no more than 10%-15%, whether you buy into physical bullions or mining equities.
I may wait one more day and see how things unfold before I make some move. But in any case, I believe that the downside should be fairly limited at the current price.
By the way, I do want to add that there was a rumor of central bank heavy selling their gold in this summer (from http://www.billcara.com/ I believe). It looks like it’s probably true, since gold market is acting relatively weak since the last short-term peak. While that’s a negative factor, we will also have an Indian gold-buying season from November to December.
Good luck trading.