Gold Nearing Resistance

The “better safe than sorry” crowd usually takes profits a little early. We took down our leverage yesterday. It was close enough.

Often price will pop one more time to tag resistance. The employment numbers tomorrow may be the trigger for the final surge to $1390. But be careful as gold could start a daily cycle correction at that point.

gold nearing resistance
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  1. Alexandru Popovici

    with Oil entrenched in clear IC decline and with USX in need to reach its YCH, it is clear that stocks are definitely in the same IC and further anguish lies ahead into August when stocks’ ICL is to be reached –> I’ll start loading stocks there

    1. Alexandru Popovici

      …or anyway, it would seem unreasonably risky, gamblish to be long stocks in the current intermarket, summer seasonal weakness, technical and fundamental contexts which all print a larger very bearish stance for stocks through the next 4 weeks at least.
      the big fundamental drag is JAPAN and its elections in 2 days as catalyst. Brexit makes no issue – it wont happen and it will be clearer and clearer that the British establishment is searching for circumvention solutions. The easiest would be Queen E 2 :
      – to use its legal power to decree “UK remains part of EU by my sovereign will! In light of the ensuing political debacle, risk of UK disintegration and of economic collapse, it is my sacred duty to maintain the country united and strong by issuing this decree and calling for early Parliament elections.”
      and then
      – to resign and leave her office to William as a gesture for having trespassed the custom of non-political interference and also as a symbol for rejuvenating the institution of monarchy by passing the baton.

  2. Gary Post author

    I’m going to take a guess and say no matter what the employment report is stocks will find it as an excuse to rally.

    A strong report is just plain bullish.

    A weak report will tank the dollar and that has been bullish for stocks and all assets since February.

  3. Gary Post author

    Short term sentiment on oil is already extreme. So far the ICL is forming as a flag pattern. Both stocks and gold completed their ICL’s at the 38% Fib. That would be about $42 for oil, or a test of the 200 DMA.

    First ICL’s in new multi-year cycles have been mild so far. I don’t see why oil would be different.

  4. Alexandru Popovici

    Gary, still it would be too early for CRB index to have bottomed yesterday (despite weak sentiment in oil) while USX needs to break above the downward weekly trend line before charting its YCH –> i.e. USX of minimum 98 by the end of this month.

    It is a fantastic synchronization btw the timings of daily and weekly cycles: USX about to reach YCH at the end of this month or beginning of August (and produce a left-translated-lower-YCH yearly cycle) while CRB, oil and stocks draw their ICLs.
    Gold on the other hand should produce a higher low.

    1. Alexandru Popovici

      …it is also interesting to see oil’s 200dma and 50wma at around 41.5 –> the ICL may test that sub-42 area in the following weeks.

  5. chrisG

    Monster jobs data. Yields up. And bank stocks is going to like it. SPX likely power up today.

  6. Alexandru Popovici

    today stocks will exhaust themselves on the upside thanks to payrolls and the shorting opportunity will emerge.

  7. chrisG

    Alex, u shorted at lower levels, and u gonna lose $. For me, I see SPX at new highs soon. So, once it is at new highs, people can say sell the breakout. But I shall let only price dictates.

    1. Alexandru Popovici

      Chris, today or on Monday the latest we will get confirmation of stocks’ exhaustion as both transports and financials will test their respective 200dma and fail.
      I will reinitiate the short as soon as I see that sign of exhaustion of transports’ and financials’ rejection by their 200dma

  8. Gary Post author

    Everything going up together, just like I’ve been predicting for over a year.

    And the perma bears getting kicked in the teeth again just like I predicted.

    No matter how high the market goes it will always be an excuse to short to these people.

    The bottom line is: stocks completed an ICL last week. It has been confirmed by a trend line break and a weekly swing. Stocks will now follow the advance decline line to new highs.

    Everything completed multi-year cycle lows earlier this year or late last year. So everything is going up.

  9. chrisG

    The longer the consolidation, the more significant the breakout. But when spx finally breaks out, bears will still say sell the rally.

    1. Gary Post author

      Of course they will. They will try to sell all the way up into the bubble phase and lose everything in the process.

      And they could be making a fortune off the central bank printing press instead of idiotically trying to fight it.

  10. Gary Post author

    If we are in a bear market like a few people still believe then answer me how can the advance decline be making new highs.?

    No bear market has ever started with the advance decline line making new highs.

  11. Don

    The market clearly loves the jobs data. Everything is awesome in the good old USA. The algos are feasting today.

  12. Don

    Bond market isn’t buying into the ‘great’ jobs number. Biotechs are partied out.

    1. Don

      What QE are you referring to Gary? The FED has been slowly withdrawing funds from the banking system, not adding to it.

      1. Gary Post author

        No they are still replacing all expiring bonds. Plus every other country in the world is doing QE.

  13. Don

    The FED is running out of excuses to further delay a rate hike. When the algos are done gorging on dumb money, the market will reverse.

    1. Gary Post author

      You do realize that doing the same thing over and over expecting a different result is the definition of insanity????

      For heavens sake quit fighting the Fed’s printing press.

      Not too mention you already went short or implied you did several days ago. You are underwater on shorts early in a new intermediate cycle and you just keep adding to it.

      The time to go short is 18 weeks into the cycle, not on week one. (unless you are just day trading).

  14. Gary Post author

    Now that the Dow is over 18,000 the next big hurdle will be 5000 Nasdaq. Once the Naz breaks out of this 15 year consolidation there is no telling how far the bubble phase will go.

    I’m going to guess 20,000 minimum over the next 3-4 years.

  15. Gary Post author

    The SPX just took out the June high. Just one more confirmation that we have a completed ICL.

  16. Gary Post author

    2008 damaged investors so much that many will continue looking for the next crash all the way into the bubble phase.

    We see it here as every move higher is an excuse to short for many of the bear trolls.

    1. s29

      So what’s your scenario for breaking the all time highs? Shortsqueeze to around 2160, then slight pullback to old highs?

    1. Gary Post author

      No no no. Bubbles are characterized by price 40%-100% above the 200 day moving average and a final rally that gains 100% or more in in a year or less.

      We have had nothing yet that even vaguely fits that description.

  17. humbled

    all indices charging towards all time highs ~
    Test of historical highs… validation coming… for the market to prove itself.

    1. bill

      Gold is down $7 bucks? what chart you looking at…. hell a coffee at Starbucks it $8 dollars lol

      1. mskhatak

        You are absolutely correct, Gold is down 7 bucks only, but it has touched 1370 and came back down. Now I think market is confused on today’s NFP report therefore Gold is wandering around 1354.
        My question to Gary is whether Gold will go up or down from here?

  18. epalazzo

    What do you say Gary: The low on May 30 was a DCL and also an ICL? The peak on July 06 was a peak or not yet? If it was a peak what do you say for July 08, was it a decline? Thanks in advance for your reply.

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