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In order to build up energy for a sustained push higher gold needs to complete the corrective move. That means a break of the trend line to trigger stops for the technical traders. Once those stops are tripped and sentiment reset then gold can go higher.
If the trend line doesn’t get broken then we are looking at a cycle that is on day 24 with little upside potential before rolling over. If gold doesn’t complete the correction then the odds are it will briefly spike higher only to quickly roll over into a true daily cycle low.
As counter intuitive as it sounds, it would be better if gold drops a little further as that would set up a more sustained move higher.
under $1270 Gary?
Yepp here we go, is 1266 enough? We got 1day left to brake it and then up next week. I want +1400 for this rally to restore the bull.
I suspect gold will continue down into next weeks employment report and scare gold bugs hard enough that they won’t be able to buy at the bottom.
Sentiment got pretty bullish recently. It now needs to take a serious hit before the next cycle can begin. One little pop below $1270 probably isn’t going to do it.
People did get very bullish didn’t they? I can understand it when some of them have made 40% on GDXJ or, as some claim, they have made just about 100% on individual miners.
Personally, I would have taken profits and run at that point.
But I doubt that mid 1200s will be enough to worry most of them. I think it needs to go down close to $1200, and perhaps a bit lower, to scare them away. How likely that is to happen I have no idea.
Hey Gary, Looks like the trend line has been broken big time. Where do you anticipate a cycle low to come in?