Many of you have read my commentary over the last several years, and have understood that I am a firm believer in this gold bull market. At one point time, tThe Wall Street Journal called me a "bull of a gold bug" simply because I believed that gold was going to break $600/ounce in 2006. I argued on countless occasions against other CNBC pundits why I believed that gold prices were still cheap and that we had at least another 5-7 years left in this gold run.
But, as bullish as I am, I find it hard to believe that gold prices will move up in a straight line. I also find it hard to believe that the US dollar will collapse within a short-period of time. As such, every once in awhile I caution that gold prices have moved up too fast and are due for a pullback. Take a look at the following charts of gold and the US dollar. Gold is clearly in an overbought situation and the US dollar is in an oversold position.
If you are a short term or intermediate term trader, it might not be a bad idea to take some profits off the table. I wouldn't be surprised to see gold pull back to the $740-$760 range. If you are in this for the long-term, and concerned more with wealth preservation, don't worry about it. This is will be just another consolidation in gold's move to $2000/ounce.