The big story of the day was the pullback in the price of gold

Gold was above $1260 last week; it pulled back a little bit on Friday, but the real damage happened overnight on Monday, while we were celebrating Presidents' Day

At one point gold was down almost $50; trading even below $1190

When we opened up for trading in New York, gold was back above $1210.; it tried to rally, but really couldn't, in fact the only time gold rallied today is when the Dow sold off to +50 from +150

The stock market and the gold market are the mirror image of each other right now

Ultimately, I do believe that stocks, gold stocks and gold will be going in the same direction because they will all respond positively to the Fed admitting that it will not raise interest rates, and in fact cut them and will launch QE4

Now, gold is the safe haven from weak stocks, but the best environment is when the Fed steps up to save stocks, and that's when the gold trade is going to catch a bid

But when the market closed on the highs of the day, up over 200 points, that means gold closed on the low of the day

GLD, the ETF for gold, for today's decline, we were down $35.90

In the spot market, we closed right about $1200 even

A good point: look at the gold stocks, GDX, that index was down 8.65%

In all the big gold up days, we never had a comparable up day for gold stocks

On gold's best day, the biggest day since 2008, gold stocks were just up about 5%

Yet on the down side, a -3% move in gold produces a -9% move in gold stocks

Why is all the movement on the down side?

One, there's still more fear than greed in the gold market

This is a good sign - a bull market climbing a wall of worry

This is just a resumption of a long-term secular market that began in 1999-2000

Goldman Sachs rhetoric may in part be responsible for the sharp selloff

I mention on last week's podcast that Goldman was recommending a sell on gold, that it was going back down to $1000

On Monday, while the market was having a holiday, Goldman Sachs was out with their PR again, not only telling people to sell gold, but to short gold

Why would Goldman Sachs be telling people to short gold?

 Why would they bother with a 20% short when there are so many stocks being killed right now that would be much better to short

Gold will never be worthless, what if it goes up? Why risk losing all that money?

The risk/reward isn't there

Goldman says they don't think there will be a recession and the Fed's going to keep raising rates

They admit there is a small chance of a recession this year: what's going to happen to gold if we go into recession?

What happens if you have shorted gold, hoping to capture just 20%?

The only thing that would make sense to me is that Goldman Sachs wants the price of gold to go down because they're probably already short - that's why