David Fuller's view These transactions occurred on Monday and due to an evening meeting I was unable to report them. Yesterday, my silver (weekly & daily) long was stopped out in a fast moving market which gapped through my stop, resulting in the sale of my July position at $30.973 against my purchase at $30.92 on 26th April. A short while later I repurchased the July position at $30.85 and this is now protected with a slightly in-the-money stop. These prices include all spread-bet dealing costs.

Stop Press - my July silver was stopped out at $30.95 this evening, including dealing costs, against yesterday's purchase at $30.85. I remain a potential buyer on dips.

The placing of stops can be tricky at the best of times and in a ranging market tight stops are more likely to be hit than not. Nevertheless, given silver's volatility, I am inclined to put in a breakeven stop relatively quickly, to reduce risk and I would certainly be tempted to take profits in the event of a short-term run, at least while the activity is primarily ranging rather than trending.

Overall, I maintain that gold (10-yr monthly, 5-yr weekly & daily) and its high-beta proxy silver are approximately halfway through lengthy medium-term correction and consolidation phases similar to what we last saw following the accelerated peaks in March 2008 and May 2006.

These interruptions in the long-term upward trend lasted approximately eighteen months. The first half of those corrections were distribution phases, evidenced by lower highs, as traders and investors sold some of their long positions. The second half were accumulation phases, evidenced by higher lows, as demand for gold regained the upper hand.

My guess is that gold is now in an accumulation / support building phase which will establish the first higher reaction low following the distribution low in late December 2011. We may have seen that higher low in early April and a sustained rally above $1700 would provide further evidence that the trading range currently centred on approximately $1650 represents support building.

I expect more ranging than trending by gold over the next few months but with a slight upward bias. Once bullion sustains a push above $1800 we will have considerably more evidence that demand has not only regained the upper hand but that this lengthy corrective phase is in its latter stages. This should occur before yearend if the time sequence for gold's earlier post-acceleration corrective phases is approximately adhered to.

That would also suggest a new high in nominal USD in 2013 and a resumption of the overall upward trend. However, if gold's secular bull trend is gathering pace, as often occurs in a maturing trend and as the three years prior to the August / September highs suggest, the next advance would commence somewhat sooner.