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Last week, somebody posted that the gold chart looks like March, 2013 — I agree with this assessment.
Before the move down resumes and picks up momentum, charts need to look as follows:
Weekly: Reversion to the mean & narrowing of the Bollinger Band. Weekly MACD starts to turn up, maybe around Aug 19 time frame.
Daily: Several candles above the mean, narrow BB with a few hits to the upside, and slow stoch turns overbought. Now that Jul 20 is off the slow stoch (14 days), and Jul 21 will fall off on Monday (last day to close above 1100), any move up will see slow stoch become overbought fairly quickly. Finally, ADX needs to stop rising, dip a little, and level off. MACD histogram has already turned positive; MACD needs to continue to approach zero.
Once the charts look like that, then the next wave down will commence, and should see an increase in momentum.
PS: I like your smaller sample for SMA/BB — 10 days. I use a little faster. And I ratchet the sigma setting out a little bit, to try to find the coveted “rare event”. I also use a faster sample for MACD.
oh no, I’ve said too much!
or haven’t said enough 🙂
I will likely exit @ 1130-ish and maybe re-enter at 950.
If this is an intermediate degree bottom gold will be going much higher than 1130. Because of how extreme this sell off to the downsdie was I tend to think this will lead to the largest counter trend rally of the entrie bear market. I’m tentatively expecting a higher intermediate high to maybe the 1250ish range before the bear resumes. To have any chance of getting to 950 we need a really powerful counter trend rally to completely reset sentiment and generate enough fuel for the final leg down.
Gold is going to have to survive at least one more attack, probably Sunday night. The powers that be want gold down to 1033 before they cover theri shorts. They used the jobs number as an aid and dumped about 12000 contracts in the premarket Friday but the sell off didin’t stick. But I don’t expect them to give up without at least one more shot at gold.
For the record, I think Gary is nailing this. Buying something that has been decimated is very difficult and there is no shortage of negative opinions on Gold but the COT and Optix make it very likely that the bottom is in.
For the record, I agree that nearly three weeks of consolidation will either break down or break out, probably Monday, but I believe the break out or down will be of minor (daily cycle) degree, not intermediate.
I do think that there will be another attack on gold but I can’t see just one further dump of gold contracts taking us down to the $1030 region. That would be a huge drop in one go.