161 thoughts on “MONEY FLOW CHARTS

    1. tater123

      Yeah sure ok … this guy knows and repeats that the bankers will no longer have access to gold reserves after Trump is sworn in.

      After a while gold bugs theories and “facts” become nauseating. Sure, I hope it’s true but while gold bugs are crying about manipulation, there are others making a killing in stocks while waiting on gold to bottom.

      Hmmmm … wonder which opinions hold more validity …. those on the right side of the trade or those on the wrong side?

  1. jskauai

    tater123, I agree with you and I sure hope it true also. My thought was that Gary claims in the above video that he felt that the bear market in gold was engineered. Avery comes to a similar conclusion. I’m sure that there are many making a killing in stocks, you just have to know which ones! Easy peasy right?

  2. duckwhorocks1

    Googling “This cannot go on” Comex we find the following artcles.
    https://www.sprottmoney.com/News/massive-gold-withdrawals-rock-the-comex.html
    http://www.silverdoctors.com/gold/gold-news/global-financial-system-will-completely-seize-up-within-48-hours-of-comex-gold-delivery-failure/
    http://www.zerohedge.com/news/2015-11-30/paper-gold-dilution-hits-294x-comex-registered-gold-drops-new-all-time-low?page=2

    These are just 3 from the 100’s created by the completely retarded nuts who drain money from the coffers of gold bugs subscribers while keeping them hoping that one day they will be vindicated.

    I’d debate (and beat) anyone at their stupid manipulation theories. If you want to preserve your capital…run…real far from anyone who screams manipulation. I, and few others called this decline perfectly…not because we are sleeping with bankers (although there is one in my building I’d love to nail hard) but because I think we all saw the signs of the top and how expensive Gold was in relation to other commodities.

  3. duckwhorocks1

    Want to see my awesome psychic powers?
    Watch for these kind of headlines over the coming week.
    Gold Bug site headlines over the next 3 days
    1) COMEX SMASHDOWN BY NAKED SHORTING OF 30,000 CONTRACTS!!!!!!
    2) CHINA BUYS ALL THE GOLD US WANTS TO SELL.
    3) PHYSICAL DEMAND OVERWHELM”S REFINERIES!!!!!!!!!!!!!! 1 MONTH of GLOBAL SUPPLY BOUGHT IN 2 HOURS
    4) CENTRAL BANKS PLAYING WITH FIRE!!
    5) “THIS CANNOT CONTINUE” ERIC KING AND ERIC SPROTT

  4. chrisG

    If I run a blog like Gary, I would say this to the gold guys… actually, I would even say this a while ago: “Guys, go take a flight!! Gold is doing its own things. I have no idea what it is doing. The easy money is not in it. So dont waste time looking at it. When its time to look at it again, I will tell you. Now the time is to look at IM, BM etc… Guys, you are here to make money. You are not here to fall in love with Gold”. Simple, stressless, logical answer.

    It is a skill, a great skill to know when not to look at something for a while.

    lol

    1. duckwhorocks1

      Amen ChrisG.
      To be it has always been a trading vehicle but over the last few years I have come to hate it because of the chronic run ins with the Gold Bug arguments.
      It is always

      1) Gold went up…….The banks are finally gonna lose
      2) Gold went down…Not a normal correction…not a normal cycle….stinks of manipulation.
      So they always have an out. They can always blame someone else.

    2. Gary Post author

      I like to buy when price is oversold.

      I like to sell when price is overbought.

      Right now gold is oversold. Stocks are overbought.

      I’d still wait for gold to complete a weekly swing low though.

      I suggested traders use a stop under 1275 so anyone who used that stop should be sitting and waiting for the swing.

      1. duckwhorocks1

        That makes sense, except in August when by every weekly measure GDX and Gold was a screaming sell you kept insisting higher prices were just around the corner.

        1. Gary Post author

          That’s ridiculous, back in August the miners were stretched 75% above the 200 DMA. I said at the time that price would either have to trade sideways or correct. Price can’t stay that far above the mean for very long.

          The semi’s are now in the same situation. They are trading parabolic. At some point they will come back down to earth.

          1. duckwhorocks1

            Wow. Love the way you manipulate what you said.
            Here right below your chart
            “I’m going to go over in detail this weekend what I think the sell off on Friday in the metals means for the sector. Hint: It’s not that bearish.”

            On your chart itself “The metals have to churn sideways for most of August before the next bull market begins.”
            https://blog.smartmoneytrackerpremium.com/2016/08/chart-day-sideways-awhile.html

            Uh…15% drop in Gold, 20% drop in Silver and 30% drop in GDX is not churning sideways.

        2. GMoney

          You can Bash Gary all you want, but y’all were laughing at him in late 2015 when he was telling you to buy Gold. Silver and the miners.

          1. duckwhorocks1

            Actually I have been posting since july……but Gary has many, many false starts over the years. Eventually he got it right.

          2. Pedestrian

            If memory serves me Gary did not actually turn bullish and make the call until middle January. But then again, i am getting a little grey so my mind isn’t what it used to be.

      2. tulip

        Gary,
        what difference does it make…. if the tape is ‘artificial’ in past tense ??
        the chart is the chart….period.

  5. duckwhorocks1

    DId she say the end was here or that the end was near? I couldn’t make out the last part on account of her neck snapping.
    Funniest thing I ever heard.

  6. Pedestrian

    Looking at JPYUSD from a weekly chart the Yen is in a near vertical death spiral. AKA, a waterfall decline. So no big surprise gold is falling hard right after it opened today. Gold is now confirming that it was a giant head and shoulders top we have been looking at for weeks on end (again, from the vantage point of a WEEKLY chart). It too is looking like it will just crash. Based on the chart line of the sharp run-u that began in January this year there is pretty much dead air space between here and the bottom so might as well strap on the parachutes because it looks like we are going in for a really hard landing.

    Very sorry for your losses Robert.

      1. Pedestrian

        LOL! No bottom yet anyway. I would say my brief moment of thinking yesterday that we were near a bounce has been utterly destroyed by the yens behavior since then. Hope lives eternally in the gold world and I suffer from it too sometimes.

        I wonder at what stage we can revisit the idea that gold was not in a new bull market after all and that the few sane people who kept warning that the huge move this year was nothing more than a bear market rally will finally be absolved of their sins (for thinking outside the box and being right!).

        Crazy as it sounds, the majority are now banking on a another January bounce and probably anticipating a repeat of last year. But what if they are all going to be wrong and instead of a bounce off a big double bottom that gold breaks to new lows instead.

        That will be a “Holy shit!” moment.

        I can hardly wait.

        1. duckwhorocks1

          Fair value of Gold is 15X oil prices or around $750
          Also FV of Gold is 20% less than Platinum coincidentally also $750.
          I doubt we get anywhere near those but just goes to show that we can get some serious downside if the stars align.

          1. Pedestrian

            The world is heading into a deflationary pit of despair Duck. That is my read anyway just based on history and how the last major credit cycle terminated in the 1930’s.

            It means a mass reconciliation of unrepayable debts and bank failures scattered across the globe as the dollar soars higher and wipes out more wealth than most of us can even imagine.

            It means that the period of sovereign defaults has arrived. And it means we will pray for inflation but hate it when it arrives because it is happening in a world of zero growth, falling populations and millions of new retirements.

            So while I don’t know how far gold might fall I cannot rule out a number like you are suggesting. I think Dent was using a similar target and he makes an excellent and convincing case based on demographics.

            If gold does keep falling and break below 1050 I think we might greet that event with real alarm. While the bears will be vindicated in their beliefs I am also certain they will not be spared the pain that awaits everyone in the kind of economy that comes with that kind of reality for the metals.

            As an aside, gold is now at it’s .618 retrace level this evening based on closing numbers since the whole bull move began and I expect it will stick pretty close to the levels we see now until the day ends. So no more declines for the moment. We will have to just guess what gold might do come next Monday morning.

            Probably we see a triangle start to form on todays hourly charts. I expect the worst now though as longs may be tempted to capitulate and sell sending prices cratering into a heap of rubble on the pavement.

            Since the market is mostly speculators that seems more likely than the probability that the shorts cover or start getting long based on the .618 fib level. I just think selling is going to overwhelm buying.

          2. duckwhorocks1

            I have the disagree with your assessment there Ped….no deflationary depression according to me.

          3. Pedestrian

            Disagreements are what keep us thinking Duck. Otherwise we risk falling into complacency by taking ideological positions that don’t pay off and can’t be traded either. So its good to be challenged.

            My belief comes from the macro charts where a steadily rising dollar becomes the undoing of the trillions of debt issued in USD, some of which will never be repaid as a global trade contraction becomes more severe and the tottering tower of debt that has been loaned into existence around the globe starts to unwind.

            Admittedly It is theoretically based however we do have evidence that dollars will continue to march higher and as they do the pressure will mount on commodities that are (naturally) priced in dollars. We should see the CRB fall all the way back to its 1973 (?) lows in this scenario with oil prices testing lows near or below 20 dollars (inflation adjusted chart) in the coming two years.

            One mans deflation can be anothers inflation though so when I discuss the idea it is always from a US centric point of view because the US is still the worlds lead economy and hosts the primary reserve currency. What happens elsewhere in the world is another matter altogether and by default when one currency rises another must fall.

            As in all discussion about the economy we can only wait to find out what will actually happen. But some aspects are quite predictable and on that score the global demographic picture is one aspect that should only be discounted at our peril.

            In the fewest words possible, we need young people to see real growth that will generate the kind of inflation most of us see as benign or as an opportunity to gain from. That is not what is coming for any of the developed or major emerging market economies though.

            So if we do see inflation then expect it to be the most destructive kind that simply robs you every year without the prospect of asset price growth to offset the impacts. All major asset classes meanwhile are overpriced by historical standards and face declines in value for many years to come based on little more than declining populations and so many new retirements. Most of us will probably agree that what goes up (too high) will eventually come down whether it is stocks, bonds or New York apartments.

            So rising prices in that atmosphere will make us utterly miserable. I cannot identify any trigger for inflation in an environment where we see growing debt defaults, falling home prices and a deflation in bonds and stocks simultaneous to declining global populations and low birth rates.

            If you can then by all means, fire away.

    1. dan123

      Bingo. Fear the once in a lifetime deflationary cliff dive. I started accumulating physical silver in 2015, but expect it to reach $4-$8 before this is over. The broad US equity market is admittedly impossible to short, but SPX should melt down to sub 1000 eventually.

      1. Pedestrian

        Agree Dan. The big picture for gold is dismal at best and the retards who pump this shit will have egg all over their faces given enough time to prove the stupidity of their outlandish false claims. I will post the gloomiest chart on gold you have probably never seen because the gold community will never publish it on any of their sites.

        We all need to see this one with our own eyes because it is instructive and something to behold. And if this chart does not give you second thoughts on the deflationary outcome that the pattern warns about then nothing else will help. Hopefully this link posts correctly.

        It is a 100 year gold chart, inflation adjusted on a Log scale.

        All you really need to note here is that gold has made a gigantic double top and we have now embarked on the decline side of the second peak. This is proof positive that what we have witnessed these past months was nothing more than a bear market rally. If you doubt the double top then just refer to the massive double bottom that preceded it (on the same chart).

        We are NOT, and I repeat NOT, in a gold bull market in any way, shape or form.

        You should link this chart or make a copy and paste it on your fridge for those weak moments when the gold promoters get the upper hand and start convincing us to go all-in precious metals for the investment of a lifetime. Hopefully more people here see this before making the biggest mistake of their investing careers. I hope everyone here will take a few minutes minimum to examine what this chart is really saying and come to their own conclusions.

        We will see gold fall below 1050 by the way. I really try to resist the temptation to say that too often because it draws so much hostility but this chart is dismal for precious metals prospects and all rally’s need to be treated with respect and an understanding that they will not hold for too long.

        This is the gold chart that the gold promoters don’t want you to know about. It speaks to a serious long term global deflationary outcome.
        http://www.macrotrends.net/1333/historical-gold-prices-100-year-chart

        1. Pedestrian

          And by the way, that chart says there is a strong possibility that Armstrong will not be correct on a gold bull as a result of people trying to get off the grid and into private assets. It may still be that most money will find its way into stocks, currencies and property in the next couple years.

          1. Steffmeister

            That is nothing new, I’ve known this for a year or more. All Elliott Wavers has more or less the same count, look at Danerics Gold count with a deflationary crash.

            Look at this chart from a skilled Swedish EW, we are heading for 600-800 Gold

            However it’s not written in stone, FED/Trump may have other plans to fight deflation!? QE4-infinity they will print a massive amount of money.

            http://www.tfmetalsreport.com/comment/587241#comment-587241

            me thinks we are not at the B-top yet, and maybe we will continue up after a B-top is reached.

          2. Pedestrian

            Said like a true gold acolyte I suppose. So your answer does not surprise me in the slightest and is typical of those who will minimize any chart that rebuffs the gold promoter nonsense.

            But Steff, this is a new and your chart example has no resemblance at all to the one I posted except that both warn of trouble ahead and potentially very significant losses for gold investors. The double top incidentally is one of the most reliable chart patterns. You would be a damned fool to dismiss it.

            So while you answer me by saying it is not written in stone, all I can add is that you not come back in a year or two and say you were not warned.

            But anyway, its your money man. What do I care what you do?

          3. duckwhorocks1

            Ped,
            You know I am not a gold pumper, but the denominator is CPI which is really very inaccurate and over the years has been meddled with a 1,000 times.
            I would not rely on that as my basis for a double top.

          4. Pedestrian

            I know you are not a bug, Duck. We need more guys like you around to act as Kryptonite to the gold propaganda. Talented critics are hard to find.

          5. Pedestrian

            About the chart though.

            It is entirely acceptable to me in its current form so I can’t really take a side in the debate about how inflation is currently figured. And the reason I say that is because the method of inflation calculation is not something any of us can change. It is what it is. And under that method we can do no more than accept at face value that there is a clear double top. Assuming that the inflation methodology does not change significantly in the future it is therefore reasonable to expect gold to fall for quite a number of years on the basis of the pattern alone. So for me its neither good nor bad the way it has come out. Just factual. My only real interest is that it is giving me useful information. In that regard we have been warned because it does tell us a lengthy gold price deflation (dollar appreciation) is still in the works and that is something that should be of concern to everyone here. I know John Williams wants to make a big deal about CPI calcs at every good opportunity. He is barking up the wrong tree though. Inflation is no where near as bad as he implies and we know that by the “Billion Prices Project” which aligns with current inflation methodology fairly accurately (see chart below). The BPP is a project run out of MIT that independently tracks inflation data based on millions of individual price changes across 22 nations each day. It is then published country by country or for comparative purposes. And it is amazing how similar it has been compared to the BLS CPI statistics. So I don’t want to be too big a critic of John but he is in the newsletter business and It suits his agenda to push his point as that draws in subscribers and income. He has a clever gig if you ask me. But he is sure no expert on this subject when his results differ so much from a well respected and independent academic approach.

            The Billion Prices Project – racking Inflation
            http://www.mymoneyblog.com/inflation-cpi-vs-bpp.html

          1. Steffmeister

            Likewise Ped, how about a cup&handle formation in Gold?

            The dollar aint the same thing today as it was back in the 30’s a 95% decay over the years. The crash has been a fact for many years but people doesb’t notice becos it’s happening in slow motion.

          2. Pedestrian

            I did look, Gmoney. That’s a great chart. Notice the 16 year period between 1966 and 1982 and how that inflationary period destroyed the value of peoples investments as the DOW lost almost 75% of its value in real terms.

            So what is notable from a chart perspective is that the trend line was falling over that time period but from 1982 onward the direction is steadily up during the less inflationary period of time.

            So this chart confirms that inflation has not arrived with any force in the present period.

          3. Pedestrian

            Probably not a cup and handle pattern Steff.
            To me that’s a very obvious left-translated final top on silver.

            It is very bearish for the present time and the duration until the next bottom some years in the future. We already saw the secular bull market peak in precious metals and it ended for gold in August of 2011 (and for silver in April 2011) and now there are many years ahead of us before we will see another similar top.

            During the intervening years prices will mean-revert back to the lows you see on the silver chart.

            The time elapsed between the prior two gold peaks was 31.35 years and it could easily be that long before we see another peak which could come in the early 2040’s.

            Now, I want to explain something to you that I would not ordinarily bother to mention because it gets into the mathematical aspects of charts and most people’s eyes will just start rolling inside their heads. Secondly, most gold bugs minds are as closed as an iron safe and light cannot usually penetrate the insides so it is mostly a big waste of my time to bother.

            But here goes:

            If you are aware of Martin Armstrong’s cycle work you will be aware that it is based around cycles determined by Pi. For our reference, Pi is commonly known by its first five decimal places at 3.14159 or rounded up its 3.14

            Now this is where it gets interesting. The exact difference between the two dates of the two major gold peaks in 1980 and 2011 is precisely 11,441 days. When we break that out into percentages it is 3134.52% of a common year.

            In other words, the date difference is 31.4 years (rounded) or stated another way, a number that is so close to Pi (3.1415) that this cannot possibly be a coincidence. And that is how you know that what we saw was the final peak of the secular gold bull market based on that unique number that defines the ratio of a circles circumference.

            Of course, no gold bull wants to hear this. It’s another reason I don’t usually bother but those are the facts and based on Pi we won’t be getting a similar peak for at least three more decades. If you must play with gold your bias needs to be with trades to the downside with an understanding that the trend is falling until somewhere around 2026.

            You just cannot buy and hold gold and silver and turn off your computer for the next 15 years and expect to be rich when the day comes. We rode that boat already and now its sailed away into the sunset. My suggestion to you is to remain objective and open your mind to something different from the usual gold bug blather and propaganda.

            I already gave you an inflation adjusted chart of gold that very clearly shows a double top formation and this aligns perfectly with the mathematical conclusions drawn from Pi.

            Use the information to your advantage or become another of the farm sheep that never learn how to trade successfully. Your choice.

  7. duckwhorocks1

    If you read this conversation you will see that absolutely no one except Deman predicted exactly what would happen.
    https://blog.smartmoneytrackerpremium.com/2016/08/dollar-update.html#comments

    duckwhorocks1
    August 21, 2016 at 6:32 pm
    Dollar may be in a bear market but it won’t be severe as the USD is about to crush the Yen. That in turn in going to crush Gold.
    Oil moving out of its low, which I think will take it to $70 will evaporate miner profits. This has been the best bull run for Gold stocks and the reason is that the REAL price of Gold rose so much. I,e, Gold went up while other commodities went down. That is about to change. Prepare for a bloodbath in Gold stocks.

    That is where we disagree.
    The Yen made a countertrend move to reset expectations.
    Already at current Yen levels Japanese exports are getting crushed.
    http://www.usnews.com/news/business/articles/2016-08-17/japans-trade-shrinks-in-july-exports-sink-14-percent

    You can run all the cycle stuff but at the end of the day for the last 40 years, USD-Yen is tied to Interest rate differentials. The Fed will be raising again and that will destroy the Yen.
    I am short Yen via USD, Short Gold and Gold stocks and long Oil and general stocks.

  8. chrisG

    U gold bears are a bunch of stupid fools!!!! Gold has bottomed. Why??? Cos I long. Lol. I am the most spineless, no principled idiot around!!!

    Ok, serious note, worth a shot here. Silver and miners so far held up relatively well. For me, who cares if this area doesn’t hold and gold goes to $1000. I will rejoice too even though i will end up losing some money. I know how to manage the downside, it’s call managing the trade.

  9. chrisG

    Even if gold is in a bear market, this is the area where there is high odds of a bounce. If lucky, bull market resumes. Gold actually is unlikely to be in a bear. Bcos CRB is in a bull market. Gold could underperform a bit at times. But not too much such that gold is in a bear market. Only question is bottom at 1170, or 1050???? Lol

  10. tater123

    Probably will get a bounce to 1250 or so and Gary and everyone will be saying the bull is alive but it will turn back down and break 1170, 1150, 1125, bounce then eventually break 1000.

  11. Gary Post author

    Based on the overconfidence being expressed by the bears (the mirror opposite of the bulls back in August) I’m going to go out on a limb and say we get the bottom sometime tomorrow.

    Sentiment was at 3% bulls in GLD as of the close Wednesday. The bullish percent index was at 7%, and all the weekly oscillators are severely oversold.

    Wait for a weekly swing before buying though…just to be safe.

    1. Gary Post author

      For gold to confirm a new bear market it would have to drop below last years yearly cycle low, and it would have to do so before the year ends.

      Barring that we still have gold making higher yearly cycle highs and higher yearly cycle lows.

      1. Gary Post author

        Also don’t forget that in order to confirm the YCL price will need to break the intermediate down trend line. Even if I ignore the election night spike and draw the trend line at a steeper angle gold would still need to rally above $1300 to break the trend line and confirm the YCL.

        1. stockpick

          That day when gold opened above 1325 and then closed below 1290…….it was the last chance for longs to get out. I doubt gold will see 1300 level in the next 12 months……the trend is DOWN.

    2. Pedestrian

      You get a big thumbs up from me for that comment Gary. I agree with you. The sentiment reading is the one technical that I cannot ignore in the sea of negative data right now. Two days ago I was looking for a bottom-fish entry point but after the Yen took another dive I lost my conviction and sat on my hands instead.

      That however served to hurt sentiment even more and as you point out it is now at an extreme that just can’t be ignored anymore. Indeed, this morning gold is putting in a reversal candle and its encouragement enough for me to pull the trigger on a initial trade because a bounce beckons.

      The bounce is coming from the .618% retrace level on gold. Actually we overshot by 7 dollars which I take as negative going forward. So no marrying this trade. I still think it is just going to give us a brief rally. If it has legs though I want to be on board for the ride.

      Good call buddy.

        1. Pedestrian

          Yes, the fib numbers will differ based on whether the software uses intraday highs and lows or whether the calculations are made based on daily gold closing numbers. When in doubt I always use the closing and often enough have to calculate by hand. Its a pain in the ass but I get better results. The breach below my fib is a warning shot to not get too complacent buying whatever rally materializes.

  12. stockpick

    Gary,
    Love your enthusism, but fighting Mr. Market is not going to help my wallet!

    Your swing low is now calling for gold to trade above 1233 in order to go long. Guess, we are now due for a bounce but that’s all we are going to get from these oversold conditions…..a technical WEAK bounce!

    Give us some fundamental reasons for gold to go higher……..I can’t think of one.

    On the contrary, the rates are getting normalized and that’s what is driving gold prices lower. Just look at the trading behavior in the last 10 days….bonds sell off, interest rates go higher, gold sells off…….If you believe we are in a black swan event, then bonds are not sniffing it!

    1. Gary Post author

      Heck we don’t even need a fundamental reason at this point. We are at the point where sentiment should drive the initial move. Then short covering should exacerbate the move. Then at some point the fundamental reason will appear.

      You should be on the sidelines from 1275 so shouldn’t be suffering any damage to your wallet at the moment.

      1. stockpick

        So it is technical trade…..a weak bounce out of an oversold condition….that’s it : a WEAK bounce. Its not going to convince shorts to cover and go long!

        No fundamental reason for shorts to cover their shorts because of a weak technical bounce.

      2. stockpick

        Actually I suffered enough of damage to my wallet from JNUG and now GDX call trade that I am now here for fun!

    2. GMoney

      Rates will normalize? Get out your calculator and see what normalized rates will do to interest payments on the national debt.

    1. GMoney

      In late 2015 Gary said the Gold Bull is about to resume. He was right. Did you listen to him at that time?

  13. duckwhorocks1

    Or this?
    https://blog.smartmoneytrackerpremium.com/2013/03
    I think gold is in the process of breaking the manipulation but as we have seen it’s been tough to get a sustainable trend going. That is the hallmark of a B-wave bottom. Ultimately I think the manipulation just stretched the precious metals markets much further to the downside than would have occurred naturally, so once gold breaks free of this volatile bottoming process the rally will be just as aggressive if not more so than the rally out of the first B-wave low last summer.

    Gold was a good $400 higher and about to “end the manipulation”.

  14. Goild

    Correct me if I am wrong.

    Gold has crossed the 1200 line. From now on there will be an
    increasingly tremendous pressure to resist further going down. The price of gold is a global matter and not just set by the affairs of this grant US. The gold industry cannot just simply crash. What we are seeing appears to be a response to the imminent increase in the interest rate. For gold to go to the $1050 level oil would need to also go to the $30 level which is not happening.

    So tomorrow as fear gets in, I hope to get lots of shares of NUGT hopefully at $5.60. And if it gets lower I will get more shares. Then it will be time to play old turkey for three-four years and awake with a super nice profit.

    Perhaps I can loose 50% but I stand the reasonable chance, if Gary is right, of making 500%

    Correct me if I am wrong. Thanks all!

    1. TennisDave

      If one reads the prospectus on those 3X ETFs like NUGT, JNUG, DUST, and JDST, they are all guaranteed to go to zero by their mathematical compilation the longer one holds them. That’s why their long term charts look so bizarre such as NUGT’s highs over $4,000 back in 2011. All those 3X ETFs do reverse splits as they keep on approaching zero. If one is bullish gold the better bet would be to short DUST but I think only Direxion insiders can do that.

  15. Dday

    Reality: gold price $1177
    dollar 101.7
    Far away from forecasts made on here. Remember buy and hold for four months switch off your computer. How is that working out?

  16. Dday

    “….For gold to confirm a new bear market it would have to drop below last years yearly cycle low, and it would have to do so before the year ends.”

    Yep still a month to go….

  17. Goild

    Need to exercise patience.
    The momentum is big and price is below the averages; so lots of caution here.
    The Dow/Gold ratio is 16.2. A clear move would be if it gets to 20.
    Though clearly it is getting close to make a great trade.
    Cheers.

  18. Goild

    A retracement to $800 is kind of very unlikely. For that the Dow/Gold ratio would
    be 24 which would reflect a major economy event.
    The Fed is being very cautions controlling a stable economy so far.

    1. Pedestrian

      It won’t be 24. That is not a correct conclusion. The ratio is determined by the price points of two variables and we don’t know (and cannot know) what those will be even 6 months in advance except by pure guesswork.

      Between now and then the Dow could rise a few thousand points or drop a few thousand points. Gold could soar (not likely) or it could crash below 1000 dollars. Every change will produce a different ratio number. So don’t try trading on that assumption of yours.

  19. chrisG

    Wow, who’s the smart Alec who has been laughing at gold bull, and suddenly decided to load up on gold today at $1172? Hope it sticks man. If it sticks, u know why he is called ChrisG??? Chris God???!!! lol

  20. TraderPete

    The bottom is now in with respect to gold and silver. We have a key reversal and a second RSICrossover. Also, the last wave down was right translated, which is a transition wave between a series of down waves and a series of up waves. We are now starting the next leg up or an impulse wave, which should take us to new highs in silver and gold.

    chrisG nailed it.

    1. Pedestrian

      Gold is in a secular bear market. Every bounce should be traded with a negative bias including this one.

      1. TennisDave

        You might be right, gold looks very fragile here. Remember also, the miners are like wasting assets. Every day they mine then sell their gold and their cost to find replacement of reserves keeps rising and gets more difficult. Miners are in a race against time even if gold just goes sideways.

  21. Gary Post author

    I posted this last night at 7:08 when the bears were calling for gold under 1100. It’s now $20 off the lows.

    “Based on the overconfidence being expressed by the bears (the mirror opposite of the bulls back in August) I’m going to go out on a limb and say we get the bottom sometime tomorrow.

    Sentiment was at 3% bulls in GLD as of the close Wednesday. The bullish percent index was at 7%, and all the weekly oscillators are severely oversold.

    Wait for a weekly swing before buying though…just to be safe.”

  22. Dday

    Fair enough its bounced off the lows in EU trading and dollar down 0.3%. Usually what happens is that the dollar recovers or even makes gains by US open and gold falls. Another normal day.

  23. Bv

    Agree. How many days have we had when gold attempts to rise when the US market opens only to be smacked straight back down again?

  24. chrisG

    Yes, gold will be smack down. Please dont long, please dont buy guys. Be skeptical. Be Very. All these are just a small bounce. It cant be real. Please be skeptical until 1350 😉

  25. chrisG

    Tell you guys a secret. Yellen just gave me a call. I told her the following week fomc, she has to 100% raised rates. She agreed. She added that along with that, she would say that going forward, rates will be raised very gradually. She asked for my permission to say that. And I agreed.

    With that, gold and PMs powered up giddily that day!!! 😉 😉

    1. Pedestrian

      It’s not in the bag yet Chris. The five minute charts on silver and platinum are nothing to get excited about.

    1. Pedestrian

      The yen five minute is still threatening too with a double top that needs to resolve during the day.

  26. Steffmeister

    There is another scenario than Deflationary crash, Pedestrian is late to the party, the Deflation outlook has changed since summer. Something flipped.

    This is a truly great analyst that knows what he is talking about. Inflation in major American cities is at 10-13%. America needs debt destruction and it’s about to run at full speed:

    http://www.tfmetalsreport.com/comment/587998#comment-587998

    Read this Pedestrian:
    5) gold and other inflation hedges remain on the fringe of the investment asset classes, not moving mainstream, , and not wanted by those who don’t cop themselves on to what is being done. Therefore inflation hedges become underpriced, and can be acquired on the cheap by insiders.

    1. Pedestrian

      We will have to disagree and leave it at that. Inflation is not coming back anytime soon no matter how many people promote it publicly. You might have noticed the dollar has been soaring. For your information that is one of the chief signals you need to watch to know that inflation is nowhere to be found. Certainly not in aggregate totals across an economy. You just cannot look at inflation numbers in isolation or you will never get this idea. Most of you don’t actually. It seems to be a curse in the gold community. Like a big blind spot that does not allow objectivity or reason to find a foothold.

        1. Pedestrian

          The end of the credit expansion cycle and beginning of the debt reconciliation that follow. These are some of the longest cycles we follow and we have just started down the path of cleaning house. Most of the expected sovereign defaults for example still lie ahead of us. Many will be in Europe. Many more in South America. China is a disaster waiting in the wings. Until now most of the problems have been papered over by falling rates and global efforts at reflation led by the Fed, BOJ and ECB. But those efforts will be overwhelmed by the sheer levels of unrepayable debts in a global low growth environment. Most here think that just because commodities were in a multi-year bear market and could soon bounce means that the deflation animal is behind us. I assure you they are dead wrong and history is on my side in this respect because all debts must eventually be paid, forgiven or defaulted on. There are no other choices. And so this is perhaps the most critical piece to the puzzle we often discuss but the one that gets the least attention.

          1. duckwhorocks1

            Ped,
            I think you are completely wrong because you are focusing on the debt. Just like Raul Meijer and his sidekick Nicole Foss have done for a whole decade (and we’re wrong).
            You should focus on Debt to Assets ratio. Sure global debt is 300 trillion but global assets are Close to 1,000 trillion. And the US consumer has deleveraged for the last 8 years. The US CONSUMER has a net worth of 80 trillion with net assets of 100 trillion and total debt of 20 trillion. Do you know of any Corp that went under with debt to asset ratio of 0.2?

          2. Pedestrian

            Assets can deflate. In fact they always deflate on a cyclical basis following a run higher. The ratios will be bust when its all done. I know the argument you refer too of course but its problem is the assumption asset valuations are more or less fixed. Our problem now is that there is no more opportunity for fresh credit growth and little existing ability to service debts already created. I don’t know anything at all about Nicole Foss by the way. I don’t read them. But I do follow historical trend lines and cycle and this is a very big one. Of course, none of it is provable until its actually a fact. So between then and now its just a great topic. Count me out of the inflation camp though. I am not a member in good standing.

          3. duckwhorocks1

            Even mean reversion in assets will have a very little impact.
            The Assets are pretty diverse and even during the worst of 2008 fell by 20% peak to trough.
            Even assuming a 30% fall, the Debt to Assets will still be 0.3.
            This is even completely ignoring that the Fed can print and buy whatever it likes at whatever price.
            4 trillion Balance sheet? Ha…In a world of 1 quadrillion of assets, with the US having quarter of it, The Fed can a tiny bit higher. Even if that 4 trillion in canceled and never sold, the total money supply relative to assets jumps a whopping 1.6%. The deflation guys ….just like Gary’s dollar call….will be waiting for Godot.

          4. Pedestrian

            OK, then I have a question for you. Can you explain the mechanism that will trigger this inflation you speak of with a rising dollar as a headwind and an inevitable pension bust on the horizon? You might say incomes and I would agree that can contribute to a certain degree. But labour is not in shortage around the world and gains will never be equal as long as there are salary arbitrage opportunities.

            Duck, what I think we are faced with comes down to the fundamentals of supply and demand. It is just not there. Try and appreciate why companies cannot grow earnings as another example.

            Because markets are already saturated and savings are flaccid among the groups that might otherwise have been able to drive the economy. Hell, 60% of the population in the US does not have a thousand extra bucks under the mattress to spend. They are broke. The entire Middle Class is on credit card life support.

            How the hell can you inflate in that environment?

      1. Gary Post author

        If we were headed into deflation the stock market would be crashing.

        We haven’t had any deflation since 2009. In fact we’ve had massive inflation. It’s been bouncing around from one asset class to another. First it went into everything coming out of the 09 bottom. Then metals. Then it focused mostly in stocks after 2011. But I think we are ready to see inflation move into all assets again.

        That has been my major thesis for awhile: All assets would go up together.

        That has been the norm for most of the last 16 years.

        The diverging money flow levels on stocks however may be a warning sign. I would keep a close eye on stocks as we move toward Trumps inauguration.

          1. Gary Post author

            Everyone assumes this is the 30’s all over again. It’s not. In the 30’s currencies were backed by gold. Countries couldn’t just print at will. Understandably this created a massive deflationary depression…which ended almost immediately when countries severed the gold backing.

            We had this same debt cycle in the 70’s except this time the gold backing was severed immediately. So instead of getting a crushing deflationary depression we got an inflationary recession, multiple ones in fact.

            We are repeating the scenario of the 70’s and we will get the same result. Inflation!

          2. Pedestrian

            I sure agree with some of your points Gary. This is not the 30’s and so we should not expect an identical pattern. And there are differences between then and now that makes the puzzle more interesting to work on.

            But one thing is still the same and it is the dollar shortage and strength of the currency that we are contending with. We have not really changed much except fiat was substituted for gold and in spite of that, perhaps even incredibly, the same problems cropped up. All I can do is look at the facts and then try to make reasonable predictions based on what happened the last time we saw these similarities.

            You know, one thing that does bother me is the classical inflation definition of too many dollars chasing too few goods. Neither of these conditions have been met for inflation to materialize. We have a surplus of cheap products and a shortfall of the reserve currency unti. It is the exact opposite of what we might expect.

            Secondly, how do we account for existing and expected declines in consumption based on demographics? There is nowhere near enough young people to drive the global economy like we saw in the 60’s and 70’s. It is not just a North American problem either. This affects every major developed nation on Earth all at once.

            Japan, Germany, the US, England, China; all are in decline.

            In such an environment the only possible way you can generate inflation outside of direct debasement of currencies is for shortages to develop. We will see if that happens once enough mines shut down, enough farmers quit the fields and enough factories are closed due to their past debt burdens.

            When we have shortages of production and raw material supplies then we will see prices rise but we are not there yet. And it is because we have not reached the latter stages of a credit bubble event where the defaults take center stage.

        1. zbigkid

          Stocks are totally over-loved, over-owned, and in a manic phase which nobody can see, bc essentially all sentiment indicators have been blown out by the manipulation called QE.

          The reason I know this, is I sat listening to my dad and brother-in-law talking over turkey dinner, that they have done well by stocks (same bro in law who told me he got his 401 wiped out in 2008), and that stocks will always go up, and merely just correct. So its obvious after the second crash (2008, and 2000 being the first), most everybody who stayed in, and hasn’t gotten out yet, is going to be the ones holding the bag. The markets NEVER cleared out at all, after 2000, or 2008, and no bear market bottom P/E’s were reached, and nor did many shun stocks. They are all trained monkeys by the buy and hold mantra spewing stock brokers and advisors. QE just emboldened every last one of them, and they are all saying there just is no place other than stocks. See this is actually past any euphoria stage, as we are 30 months past the avg bull cycle. Now its just a permanent state of full denial that stocks can even ever correct more than a few percent. This is what the Fed has been wanting for years, and they have never ever targeted inflation. They’ve always wanted everyone’s psyche to be fixed on stocks, period, bc they have figured they can keep manipulating stock markets higher, by continuing to buy futures whenever its needed. They’ve wiped out every single bear by doing this. Now the euphoria is in the dollar, where there is every other currency taking it on the chin, so people really think the US of A is the all time bastion for the perfect currency, and perfect stock market. We’ve defied all laws of gravity in US stocks and US dollar. Which brings people to believe, that we can issue debt in perpetuity.

          May dad and brother in law don’t know squat about ‘investing.’ Its disguised gambling. I dont wish them ill, but I did stay very quiet on the topic.

    1. Alexandru Popovici

      Hello, Bekind!
      Nope, I do not average down my long trades.
      Thus I am obliged to scale in at minimum the same price as the prior one, in this case it was 1187 two days ago.

      I am one third of my intended position invested in long gold. I’ll put some more today as I seek validation from US trading session and the last portion to a full position on Monday.

      1. BeKind

        Hello Sir Scorch! Don’t average down longs….good rule to keep you from losing too much on any trade. Discipline! Please keep posting your thoughts. And Happy Thanksgiving from America.

  27. duckwhorocks1

    The train is not leaving the station. $1,200 will a good place to load up on shorts with a stop at $1,220.

  28. Jeff

    ^^^^^ I like this Gal…

    and the triple top reversal on the $USD 15min chart

    or is it a Cup n Handle pattern :/

  29. goldilocks

    Outside up day possible for GC and SI. THE TRAIN IS LEAVING THE STATION! Duck you are a party pooper!

  30. pacoquin

    in this last video and gold chart u just put, forget about money flow, look at RSI and MACD… and tell me pls… if Gold reached bottom. Yes, I think in next coming days.. Euro will rebound slightly, most probably to 108-109.. and Dollar.. back to 99 or even 98.. and u will flip.. thinking this is it !!! But when Euro fall.. and Dollar highs continue… I really hope u land … asap … and start reading markets correctly.. for yr own benefit… and yr customers… because wish u well

  31. Alexandru Popovici

    WEEKLY SWING LOW IN UTILITIES – SEGMENTS ROTATION HAS STARTED AND THE SCORCH OMEN IS CLEARER.

    Bullish pattern is developing for EURUSD and gold on inertial dumb US retailers fighting the new bulls.

    After clear FOMC minutes on an inevitable rate hike, USX put its ICH yesterday in late Asian, early European trading – not to be surpassed until late winter.

    1. Alexandru Popovici

      SEGMENTS ROTATION – more evidence that it’s just started today: Consumer staples advance on HUUGE VOLUME, one third of average daily volume in just 40 minutes of trading today !!!

      If you wanna have stocks, then peak staples & utilities!
      They put their YCLs, treasuries put it 2 days ago, gold has put it today, now its time for offensive stocks & “the other” commodities to chart their respective YCLs through JAN.

      PS: On Trump’s inauguration, the YCLS will have already been put by more than a week.

        1. victor

          don’t bother to correct Alex, everyone looking for a meaning not grammar…, ( :
          Q. would you short biotech? Good trading to you…

      1. yasen

        Alex, good eye on the swing low in XLU. What ETF are you looking at for consumer staples, as I didn’t see the referenced volume in XLP.

      2. daverobson

        Thanks Alex so when you so late winter .. you mean End of February early march when you will rotate out of utilities and gold —stocks have their YCL? Thansk Alex keep up the great work!!

  32. Frederic Degembe

    I do not agree with Gary comparing current gold chart with bottom of Jan 16, RSI was far higher then and showing positive divergence. We need a lot more time on chart before gold can be bullish.

    Gary states he likes to buy oversold stocks/ commodities, this is a dangerous strategy, I prefer to buy oversold after a double or triple bottom with better technical chart than the current chart in gold.

    http://www.marketwatch.com/story/why-gold-hasnt-yet-hit-bottom-2016-11-23?siteid=yhoof2&yptr=yahoo

  33. Alexandru Popovici

    Yasen, it is XLP indeed. Its EMA(50) of Volume is ~15 mil shares/day and not it stands at … 5.5 sharp, i.e. 37% in 67 minutes of trading.

  34. Alexandru Popovici

    THE SCORCH was just a match fired at the base of the pile of wood at the beginning of this week (as $UTIL, XLP and market breadth signaled), now it’s fired the small branches while the vast majority of people looks at stock indexes going higher, at the big pile of wood while considering mad or stupid those calling for a correction –> “where the fxxx do you see the fire man?! It’s a nice pile of wood.” – Brian style.

  35. Alexandru Popovici

    Robert, above 1400 but most likely I will not ride up to there.
    I will stay in gold until USX reaches its ICL in early JAN; the ensuing volatility in gold as USX moves to higher ground will render gold uninteresting – there will be plenty of opportunity riding financial, energy, copper mining (COPX) and semi stocks after The Scorch is over.

  36. Alexandru Popovici

    Heeding you again: the trends so far and the incoming ones are not and will not be Trump related.
    Trump will only will intensify, increase the speed of these [inflationary] trends but it will be wrong blaming him for the coming of inflation, for rising interest rates, or short term for the incoming correction of stocks through early JAN.
    All these would have happened under Hillary too but at lower speed.

  37. waverunner55

    OldTurkey since 2013. Starting to think about going ColdTurkey and moving into a different sector of the mkt.

  38. jonsyl

    Hope continues for gold bulls inspite of any sign of a bottom. Simply in interest in gold on the horizon. Best to continue the watch the dollar. The only thing that will tell the tale. Anything below 1170 will usher in a cascade.

  39. Alexandru Popovici

    Dave Robson, by late winter I referred to USX moving above 102.12 set yesterday morning.
    Rotation out of defensives back into risk-on assets should be timed at the beginning of the year – by JAN20, the inauguration of Trump, markets will have already rotated back risk-on.
    On the other hand, it is also true that the 1st daily cycle in a new YC usually is highly volatile ( 62-fib retracements) but that’s also independent of Trump – it is a statistical fact.

    1. daverobson

      Thanks Alex…… My wife rolls her eyes when I start talking about technical analysis or stocks…. to any guests. I live and breathe this stuff 24 hrs a day…. trying to determine and interpret the market is challenging ….trying to not to lose your portfolio in gold is another matter. Alex you bring a new vision in using currency ratios in influencing your decision along with cycles.

      1. Alexandru Popovici

        🙂 yes, people do not understand us and when it comes to stock exchange collapses people blame us, the traders (just as they will stupidly blame Trump for the correction to come), as if a trader (regardless how big he is) is stupid enough to short something that in his opinion is truly shortable, as if market manipulation is not just pervasive but total.

        yes, we have to consider the pair currencies as filters since they are the components of USX, the underlying drivers of US dollar Index.
        For instance, I was saying that we would not see gold actually springing until we see EURGBP doing it and look at it sitting at the bottom.

        Why EURGBP?
        because:
        – both have large weights in USX,
        – GBP is the leader currency in the basket of USX,
        – both EUR and GBP have to rise against USD buuuut if EURGBP pair rises IT MEANS THAT EUR IS GAINING STRENGTH OVER THE LEADER, THAT EUR IS MOVING AT HIGHER SPEED THAN GBP AGAINST USD, THAT THE CURRENCY MARKET HAS RESET IS THINKING, and this reset will automatically spill into gold sentiment.

        good night!

      2. yasen

        I know what you mean daverobson in regards to 24/7. Last night my dream involved the dollar. That the US was about to go to war with China over the Yuan devaluations. Obviously, my hate for the USD has slipped into my unconscious mind.

  40. duckwhorocks1

    Ped,
    In response to your last comment.
    The rising dollar is a headwind to inflation here but a booster to inflation everywhere else.
    1) Wage growth in the US is at a 10 year high of 2.8%, which is 2.3% higher than short term interest rates.

    2) Wages for Middle managers rose at over 3% YOY.

    So we already have inflation. Of course the deflation theories will keep saying this is temporary….well we have had inflation above interest rate levels for 9 years…when will it take off?
    One Employment reaches saturation and the consumer has delevered enough.
    Both are here.
    you will get 4-5% inflation within 1-2 years.

  41. Steffmeister

    I will keep these ignorant lines for a later egg face dual 🙂

    “Agree Dan. The big picture for gold is dismal at best and the retards who pump this shit will have egg all over their faces given enough time to prove the stupidity of their outlandish false claims. I will post the gloomiest chart on gold you have probably never seen because the gold community will never publish it on any of their sites.”

    I think the bond and stockmarket is in much deeper problem than Gold. Gold will fall to a lesser degree than stocks and bonds during a potential deflationary period.

      1. Steffmeister

        I am seeing a gigantic Cup&Handle formation in Gold not a double top! Why? Just look at many other currencies, like british pound, CAD, Scandinavian currencies, mexican peso rubel etc.

        The are all making new highs and the dollar will follow.

        1. Pedestrian

          Sterling is not making new highs. It has crashed more than 20% this year and is officially in a bear market. What you smoking man?

        2. Pedestrian

          And the Canadian dollar has fallen from .81 to .74 in the past six months.
          I am sorry to have to say this Steff but you can’t read a chart.

          1. Pedestrian

            Sorry Steff, what you wrote was:

            “Just look at many other currencies, like british pound, CAD, Scandinavian currencies, mexican peso rubel etc. They are all making new highs and the dollar will follow”

            So I looked. And you were wrong.

          2. Steffmeister

            I pointed you in the right direction and all you came up with “you are wrong” wtf, are you a child? A spoiled teenager …

    1. Pedestrian

      Talk about a bad investment! Too funny though. I have never seen that chart before but it is a real gem.

      1. duckwhorocks1

        Ped,
        The CPI methodology is not the real issue.
        I know John Williams bitches about real CPI being much higher….then someone should ask that idiot why the price of his newsletter has stayed the same for the last 12 years.

        My problem is that the CPI methodology has changed over the last 100 years multiple times. The weights have changed….some point it was arithmetic mean now it is geometric. I think housing was a direct component long back and now it is owner equivalent rents. So that means over time you are dividing my different things so that makes it harder for me to equate over time.
        JMO.

  42. TennisDave

    Gary, would you please address my observation of the GOLD chart you posted on “Money Flow Charts.”
    I observe the recent Money Flow down spike and the current MACD configuration are extremely similar to both those configurations on that same chart as in early 2013 !! Subsequent to those early 2013 GOLD chart configurations of Money Flow and MACD, GOLD had many months of substantial declines.

  43. TennisDave

    Anyone else want to comment on the technical similarities of today’s GOLD market with that of early 2013 ?? Especially with regards to technical configurations of Money Flow graph and MACD graph relative to GOLD price graph.

    1. rupp

      Only comment is you wont get a reply from gary. I asked months ago how this was different than when he was pumping in 2013 that gold would rally for years, making a final top in 2015, 2016. I got no response, other than he supposedly told all his subscribers in private to bail on gold early on, but kept pumping vidoes on the public site (still available for viewing if you look back). Ironically, ever since I asked the question gold has been crashing, non stop. Haha

  44. briansmith672

    rupp Gary fcked it up for subscribers too. They were down huge after he made his gold buy call months ago; he kept pumping as the miners kept falling daily. He is clueless about almost everything and is constantly flip flopping/. He has as much idea as to where anything is going as you or anyone else does.

  45. ARends

    Hi, after reading most comments I thought this will add value to each one. I thought I would copy a very good technical analysis PM I follow showing both sides of the coin by a bank analyst. Considering all angles to where we are on all time frames. I like to compare many points of view. As you know its influenced on daily bases to reassess where we going. This is his weekly summery.

    (Reuters) Gold prices steadied after falling to 9-1/2 month lows on Friday, heading for a third consecutive weekly decline as investors sold on factors including expectations of a U.S. interest rate rise. Spot gold was down 0.03 percent at $1,182.88 an ounce by 2:15 p.m. EST (1915 GMT), after tapping $1,171.21, its lowest
    since Feb. 8, as funds took profits on short positions. The precious metal has fallen more than 7 percent so far in November, leaving it on track for its largest monthly fall since June 2013.

    U.S. gold futures settled down 0.9 percent at $1,178.40, after dipping to their lowest since Feb. 5 at
    $1,170.30.

    “Investors are still retreating from gold, though prices falling below $1,200 has promoted some profit-taking,” said Commerzbank analyst Eugen Weinberg. “Gold is being driven by many factors including equity
    markets, currency markets and expectations of higher U.S. interest rates, which are going to be a huge burden.”

    Equity markets have rallied since Donald Trump won the U.S. presidential election. “The rising dollar, yields and U.S. equity prices all weighed on the appeal of the buck-denominated, non interest-bearing and perceived safe-haven precious metal,” said Fawad Razaqzada, technical analyst for Forex.com. “In terms of the dollar, the slight weakness we have observed at the end of this week could very well turn out to be temporary even if a December rate rise may already be priced in.”

    Though the U.S. dollar fell against a basket of major currencies on Friday, it was on track to close higher for the third straight week after reaching the highest since March 2003.

    Markets are now pricing in a nearly 100 percent probability that the U.S. Federal Reserve will raise rates at its December meeting, according to CME FedWatch. That would further boost the dollar, making commodities more expensive for holders of other currencies. Overall holdings of physical gold in exchange traded funds
    (ETF) have fallen more than 5 percent to 54.135 million ounces since Nov. 9, the day after the election.

    “A further test of the downside cannot be ruled out just yet, especially as ETF liquidations persist,” UBS analysts said in a note. Traders say the U.S. monthly jobs report due on Dec. 2 will be key to market sentiment.

    COT Report

    Here we see massive contraction of long positions. As you can see, net position has dropped significantly, open interest has decreased as well. Position dropped 2 times, open interest almost for 250 K contracts. Still, net position is still rather high, compares to it’s historical value.

    Here is performance of SPDR holdings. Take a look – on first drop of gold, SPDR holdings has not changed, even grown slightly, while on current performance we see starting sell-off. Previously when this kind of divergences happened – gold has shown “failure” reversal and uptrend continues. You can see that this has happened twice in June. But right now, as SPDR holdings support downward action – this tells that this is real contraction of long positions by inverstors.

    Technicals
    Monthly

    As COT report mostly has completed its role and predicted first drop, now we again should pay more attention to technical picture, to estimate destination point of current bearish action on long-term analysis.

    Monthly picture currently supports our suggestion on deep retracement, this is just how markets work. Sooner or later but this retracement should have happened and now it stands underway.

    Technically recent upward action started in Dec 2015 is first one after long term of decreasing and it should be interrupted by deep retracement sometime. Probably it should happen but this potential downward action has a great chance to become just a retracement. Overall political and financial situation in the world probably will not give a chance to relax. Thus, we have a positive long-term view on gold market.

    As market slightly has moved above YPR1 and our K-resistance area, something is starting to form here, I mean pattern by which long-term global trend could change on gold. Price has formed nice bearish engulfing right around this area and now gold is following to its signal

    Take a careful look at the picture – here we could recognize H&S pattern. Besides the shape itself, some features here that in general typical for H&S. For example, relation between head and shoulders – 1.618. Butterfly… very often first part of H&S takes the shape of butterfly pattern…

    Finally take a look at action on downward slope and upward one of the head – last move down was slower than current move up. All these moments point on possible H&S pattern here.

    Now gold stands at the area where the bottom of right shoulder should be formed. Thus, our first step on this long-term time frame has been completed – “we suggest further drop on gold, at least to 1160-1180 area.”

    Now we’re coming to second step how we’ve specified it – “watch for validity of H&S pattern.” Right now there is an issue exists that we do not like. This is too fast drop. Actually right shoulder is an area where bulls should gradually take control over the market and fast drop here is not a good sign. Still, our task here is relatively simple – just to watch for reversal patterns on daily that confirm bullish reversal and monthly H&S pattern. If we will not get any – then we will not go long, and it will mean that this H&S could fail. The failure of this pattern will lead price below the head, i.e. under 1000$ level.

    Conversely If H&S really will work, we expect new long-term bullish trend on gold market that should lead to new highs on 2000$+ levels. It means that 1160-1200 area should be treated as strategical point for long entry.

    So, you could imagine the value of bets around this pattern…

    Now market comes closer to MACDP line, so it would be perfect if gold will reach our predefined level and simultaneously form bullish monthly grabber… Let’s watch for it…

    Weekly

    As gold has reached pre-defined support on weekly chart, and H&S pattern here has completed its mission, we will take a look at weekly chart from different angle today. Since our task right now is to estimate validity of monthly H&S pattern, this picture could help us to specify important moments in this task:

    As this rally has started gold has broken up long-term downward channel. This was a sign of changing trend on gold. Right now market returns back to re-test it from opposite side. In general, this is very typical action for gold market. Gold has some habits, such as deep retracements, early reversal traps and others. And one of them is re-testing important levels.
    So, around 1170 area we have not just broken channel border, but also major 5/8 Fib level and weekly oversold. Border itself stands slightly lower, around 1150$. Here we should understand two things. First – the strength of this support is sufficient to hold real bullish market and to stop downward retracement. Second – price drop right back into channel will be bearish sign, and this could give us early alarm, even prior monthly H&S will fail.
    That’s being said, right now on gold we will not just watch for bullish reversal patterns on daily but also keep an eye on 1150-1170 area and control, whether gold will hold above it or not.

    Daily

    Currently we can’t make any detailed analysis on daily chart, since dropping just has stopped, and it’s too few time has passed since then. Thus no patterns have been formed yet here. Daily picture also shows that AB-CD pattern has reached 1.27 extension that creates an Agreement with major Fib support level.
    First bulk of patterns that we will be watching for are based on thrust. And they will be DiNapoli directionals. Appearing of DRPO “Buy” looks more reasonable in current situation. These patterns are faster, while more extended patterns as butterflies, H&S etc need more time to be formed:

    Hourly
    On hourly chart all these stuff could start from small H&S pattern. As you can see gold keeps well upside harmonic retracements, and here it already has completed it. Thus, if somehow it will run higher, this could become a sign that some pattern is forming. Neckline of this H&S coincides with WPP.
    At the same time, guys, don’t be decieved by time scale. Hourly is too small to test monthly patterns. It could bring just first signs, but they should lead to appearing of patterns on daily chart… That’s being said, major time frame is daily, there we should get something that either will confirm monthly H&S reliability or bring early signs of its failure.

    Conclusion:
    As market has completed first step of our long term analysis – dropped to 1170 area, now we’re turning to second step – estimating of validity of monthly H&S pattern.

    Our task on short term charts are relatively simple – watch for patterns that either will confirm monthly H&S pattern or refute it.

    The technical portion of Sive’s analysis owes a great deal to Joe DiNapoli’s methods, and uses a number of Joe’s proprietary indicators. Please note that Sive’s analysis is his own view of the market and is not endorsed by Joe DiNapoli or any related companies.
    http://www.forexpeacearmy.com/community/threads/gold-pro-weekly-november-28-02-2016.48134/

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