As the dollar recovers, gold seems to be going lower and lower. The commodity is now trading in the 800’s

Gold stocks (GG, ABX, AUY, GLD, GDX) are also trading at 6 month lows. On the flip side, DZZ, which is a short gold ETN has gone up from 24 to 34 or 40% in just over a month.

What I find odd is that a consumer report regarding wholesale prices rising came out yesterday. This indicates there is inflation going on and gold should be a good hedge against this inflation. The above stocks are trading awefully cheap and I’m really tempted to get into ABX since support seems to be around 30 and maybe AUY with support at around 10. If gold stays under 800 for an extended period of time, more than a month, then I might have second thoughts on this. I’m going to follow these two stocks closely to see if support holds then enter a small position.