In 2011, gold reached a record price of more than 1800$ per ounce however the market started selling that gold for a profit expecting that 2012 was going to be a bad year for gold and the market never recovered from that hard selling.
2012 is a very bad year to trade gold because there is no sign of bullish buyers trying to make a profit with a record price of just 1600$, it seems that traders are just too cautious at the moment to trade gold.
What’s more, Oil price is at the rock bottom for the last five years and traders are switching from Gold to Oil.
The EUR/USD and the GBP/USD are both at historical downs and ready to rise steadily in the next weeks so there are three big reasons not to trade Gold in 2012.
Traders who have capital are better off trading oil at the moment because oil price is very likely to move up 10% in the next weeks, perfect for a quick profit.
On the other hand, traders who prefer to trade Gold, are better off buying at 1550$ and selling at 1650$, then shorting for the same price and buying back at 1550$. This price may not move sharply in the next six months unless traders get mad and start all together buying lots of gold.