"The 200-day moving average exerts a force much like gravity on the current price," blogger says

Trace Mayer of RuntoGold.com uses the 200-day moving average to conclude that gold is doing just fine. By definition, the 200-day moving average is "the sum of the close from the previous 200 trading days divided by 200."

"While gold may be extremely volatile day to day, the 200-day moving average shows a completely different picture: a nice gently sloping bullish trend line. In the financial markets, the 200-day moving average exerts a force much like gravity on the current price. ...

"When it comes to allocating capital, I like to focus on intrinsic value. Buy low and sell high, and I think money is made when you buy, not when you sell. To accurately perceive value, I use gold as the numeraire and the 200-day moving average to filter out daily noise and aberrations. ...

"But there are always opportunities and deals to be made. The issue is whether you buy valuable assets on the cheap or when they are expensive."

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