124 thoughts on “CHART OF THE DAY – $XAU”

  1. Gary Post author

    Sentiment in bonds has reached bearish extremes and price continues to drop. That usually indicates a bear market has begun.

    Any rally should just be a dead cat bounce.

  2. Alexandru Popovici

    GBUSD tanks as expected – heralding & leading all currencies in the advance of USX to come in a couple of days, after a dead cat bounce in JPY to gain steam at any moment and to last through Friday.

  3. ARends

    I see enough to support Gary outlook on Gold being bull.

    Out of the global economical we know that we should be in a gold bull and from a technical point we are also. I think looking at your monthly & weekly chart you might miss a few points from a bull point OV.
    Monthly years of bull you might just see 2015 December low as retracement on fib 0.618 from the 2011 top. Weekly we at 0.618 fib retrace from Dec 2015 low to 2016 July 1375 which is still perfect for continuation of bull weekly retrace and monthly retrace . We are on the precipice of perfect technical supports and fibs for retracements of bull and going below 1150 might upset the applecart weekly bull to be optional long term (monthly) bear outlong but would still not eliminate the bull. You might realise the point we at 1170-1180 level gives us the leaway of the weekly close in the bar keeping us on the resistance level (from 2013) as you will see it over the monthly chart over resistance now over years. The 2015 dip (to fib) under that resistance was out of the channel from that resistance back to the top (1375) on the monthly. If bedip below level recover with in week as spike for upper rebounce we we resume bull. monthly, weekly and bounce daily. We need to look how daily influence weekly then monthly.
    the chart mentioned or discussed if you do not see it monthly https://www.tradingview.com/x/gtXh3O8s/
    weekly
    https://www.tradingview.com/x/2DtNOcHu/

    My optimism is also grounded in the start of the bull 2007-2008. Have a look at the first retracement. S CARY but then the acceleration. Considering present influences of debt, dollar ect gold currency delinking started in the 70 with all countries participating but gold kept a place from 2008 (must have been signs for the 2009 burst clever money) while correlations since are jumping and changing rapidly from one thing to another with a new cattle of fish 0 % intrst. The other thing we can use the 2008 ICH and ICL that was on the fib with close above monthly 0.618 then we see the continuation of the bull market with 3/4 of cycle just above icl to 2011 https://www.tradingview.com/x/ZQ12kIHJ/

    1. Goild

      ARends,

      I fully agree with:
      “Out of the global economical we know that we should be in a gold bull ”

      One aspect to also consider is that since 2013 there has been support for gold around $1200; this has coincided with the period of nearly zero interests rate. To substantially break that support a strong force should come. That period will end sooner than later and then the question is why gold should go down when the interest rates would go up? On 12/14th at 2:00 PM there would be likely a strong up/down swing in gold’s price.

  4. ras

    Nice chart. In January 2016, gold spiked $60 to hit flattening 100 ma overhead and pulled back to a rising 20 day ma about to cross 50 day ma. At this time, all moving averages are in descending mode. We need $80 bounce to move above ma 20 and get close to ma 50 and then sideways movement for a while to help ma 20 flatten out. This sideways movement could consume some time. Furthermore, in 2016, aem and abx and a few other pm stocks moved above rising ma 20, well before mid January, signalling an upcoming trend change. At this time aem , the leader, is still in free fall, lending credence to the thesis that pms could be due for a bounce followed by a sideways move before delivering the kind of sizzling performance that we saw prior to August. Time will tell.

  5. Goild

    This morning so far gold is up.
    Beware that today’s move may be like yesterday and could go much deeper.
    Be ready to short it.
    Hopefully it will go beyond $1180.

  6. Alexandru Popovici

    Today will be JPY’s day and with it gold/miners will shine too up in a clear new daily cycle.

  7. Gary Post author

    A couple of months from now we will look back at the divergence in miners and wonder how in the world we could have ignored that bottoming sign?

    The only question is will the banks try to create one more stop run like they did last January?

    The signs are already there though. The miners are bottoming.

  8. Goild

    We still need to be very careful, we may see a trap set to 1185 to fall back to 1165 then to definitely go up.
    Manipulators: I will be ready to take advantage!

    “You know, it is a bull market”

  9. Alexandru Popovici

    Crude oil will produce a weekly swing high next week to cast a clear signal it put its YCH 2 days ago at 52.42, on an expected bull trap 😉
    Now at 50 something, oil is closer to 39 than to 52 🙂

  10. Goild

    Alex,

    Hoping to see oil at 39 appears not to be consistent with the facts.
    For the first time in a while OPEC had some kind of arrangement.
    That would make it very difficult for oil to get back to below 40.
    My guess at best it could see 45.

    1. ARends

      Goild, what about the fact that volume dimensions for Opec has changed since US can generate so much oil for fracking filling the short and taking more market share, will no unlimited oil. As far as I know US is not part of Opec. This snag has changed the value Opec has on oil control

  11. Goild

    Alex.

    Oh, I guess you mean 49, yeap regressing to the averages today or tomorrow is likely.

    “You know, it is a bull market”

  13. Alexandru Popovici

    Goild, nope 39 is my target for oil.
    Short term indeed, oil should regress to 10Wma to print its HCL and then up a bit and then back down to YCL around 39.
    Oil needs to get to 39 in order to see 70 by next year’s end.

  14. Goild

    Indeed we gapped up today!
    It shall remain to see how big the candle body will be and whether it would be green or red.
    Beware of a trap.

    “You know, it is a bull market”

  15. Goild

    Alex,

    I hope you are right; then I would get a big OIL position.
    Do you have any insight why USO is lagging in price so much?
    Last year when oil was at 40 USO was at 12.5.

  16. bill

    Up big this morning, awfully quiet in here lol… Im old turkey and have added large on all dips, its money I don’t need, but money im happy to take when the time comes.

  18. Goild

    I like today’s up going rhythm, up little by little is a good indicator.

    “You know, it is a bull market”

  19. Alexandru Popovici

    Goild, the answer to your question is contango – USO is a play on the outright oil futures contract.
    Try USL etf instead 😉 USO should be used solely for short-term investment whereas USL is the appropriate vehicle for whatever term because it is a mix of all futures contracts so that contango effect is dimmed.

  21. Goild

    Alex,

    Thank you for pointing at USL.
    I’ll get it whenever is a good time to get on board.

    “You know, it is a bull market”

  24. vin

    Guys, it is sooo obvious that it is bull and has been a bull for the last two years. I mean the gold and the golds….. Any, doubts? ……. btw, if you don’t buy right now you Will feel sorry two months from now. …… In a bull market you can enter at any point and make money. …… everyone is always wrong and misses the bottom over and over again. So, listen and listen carefully. It is all bull and a big one.

    Ooops! The market went down because the BIG MONEY was manipulating the market. But don’t you worry, all the indicators are pointing to a Bull. ….. Two months from now, you will wonder why didn’t you listen to the perfect advise?

    And, don’t forget that dollar is going to collapse any decade now.

    Where have have I heard all this over and over again?

  25. vanbc

    Gary, Thanks very much for your daily analysis for all. You believe it is bull market for GOLD, but There are three negative factors ($BPGDM lowest to 7.14; GLD tonnage huge amount decline; COT long/short in lower amount) made me doubt it is a bull market? Gold price go back to 2015 low is possible.

  28. ted

    Stocks are on a tear, and there is no sign of a letting up. Parabolia has just begun. Avoid talk about the Scorch, tops, overbought conditions, and bearish divergences. This market is just getting going. Avoid Gold. Buy stocks. Simple.

    1. vin

      You are going to feel sorry two months from today. All indicators are showing that the gold and the golds are now bull. This is a life time opportunity. Gold looks fantastic both fundamentally and technically. People are ALWAYS wrong at the bottom.

      But, be careful of the manipulators. If gold and the golds don’t go up then it is all because of manipulation. On the other hand worry not because all indicators are positive. THE bull will correct all your mistakes, may I add one way or another. Of course in due course of time, because manipulators can create havoc and distort the market for a long time.

      Also, don’t forget that the dollar is about to collapse, any decade now.

      If you make money then remember me. Otherwise it is your decision and invest only the amount you can afford to lose.

    2. ras

      Acceleration stage has just begun for SM. Dow is powering higher propelled by mmm, mcd, hd, nke, dis, wmt and others. It could be sweet for a few days for nimble folks. 4 months is a long time to be on the wrong side of price in a non-performing pm sector. Pms will have their day in the sun a bit later. After some pull back, energy will be trending up too. Bouncing time for gold/silver. After that, who knows?

    2. vin

      Yes. Yes. The dow is up only 74 points. It is going to collapse any decade now. And, gold is going to shoot up. I am with you buddy. I am planning to sell my house to buy JNUG. One day I am going to be a rich man and buy a mansion in California or may be Dubai with the profit. Wish me luck.

  30. bginvestor

    So nice to see my metal positions (GDX/SLV) look really strong today. Are any folks here going to start loading up?

    1. Goild

      bginvestor,

      Today is Wednesday and not a good day to gauge the market.
      It might be a trap for gold, perhaps the end of the equities rally, and is too early to load in view
      of the FOMC. Once we pass the FOMC and depending on how the wind blows then it would be time to think to load.

      By the way, how much fun we derive from comments on this site!
      Some of you guys have a fine sense of humor.

      “You know, it is a bull market”

  31. Alexandru Popovici

    Smart money are stepping up insurance against SM: VIX is getting back to its highs of the day even as SPX marks new historical high.
    We should see significant selling on strength soon.

    2. Alexandru Popovici

      when you will look in the hindsight you will be wishing not to have taken part in this rise – red candles will look huge.

    4. ras

      Not so sure. SM will keep going up until mmm, mcd, hd, etc. make either double tops or higher highs to set up a bull trap. vix will take care of itself. It is important to see under the hood, not just the averages.

      1. vin

        You mean, the biotech won’t lead the market to great heights? I guess gold is a better bet? Dow is up only 200 points. Do you think it will collapse soon? 2050 or sooner?

        1. bginvestor

          This santa rally is crazy; shorting at the right time will make some serious money.. Sharp drops in first week in Jan (or so) have been very consistent for the last several years..

          I wonder if everyone will still be drunk from the Trump eggnog..

        2. RonL

          Vin your sarcasm is funny for awhile but is getting old very fast. If you have a position on metals then post it with support and forget the sarcasm.

          1. vin

            RonL, I came here to learn. So if you can please educate me without insulting my intelligence and not repeating the same stuff over and over again as many here do, including the leaders.

            Please tell me honestly have you made money trading metals by catching every short term peaks and valleys. If you have then I would want to learn how to do it. Please advise me and I will follow you.

            Btw, I am invested in metals and even trade once in a while but catching every peak and valley is something else, specially when it is universally recognized and there are some big players who play this market with a certain agenda.

    3. vin

      GMoney, Why does it surprise you? A great amount of money has been taken out of treasuries. If a fraction of it goes into equities it has the potential of doing wonders. ….. But, what I don’t understand is why a fraction of it is not going into gold or golds. In other words, why is gold so hated? Is it it because it is the most useless substance on the surface of the earth?

    1. vin

      Please listen to the experts here. Don’t buy equities even when they are shooting up because one day they will collapse. But, buy gold even if it is falling because one day it will go up. Who knows it might even go to $1300! LOL!

      1. RonL

        Vin in reply to you reply to me above, I bought Hecla Minning 30,000 shares on 9/9/15 for $1.85 as my core holding. I have traded m any other metal stocks during that time with a moderate profit.I intend to hold this core position until Hecla Minning reaches $1200 plus. AS of today that holding on paper is up or 300% and I expect it to do at least 1000% in the nest 2 years,
        I was not insulting you but your sarcasm in you post to others comments has no place in an intelligent forum.
        Good luck t0 you but your post mean nothing to me and in my opinion added nothing to the discourse here.

        2. vin

          Thanks for letting us know that you have made money by buying and holding a well managed mining company. What has that to do what is being propagated here?

          Let me repeat I came here to learn and what I find here is all big talk with no substance. It is not only the cockiness that has really thrown me off balance. It is one thing to be cocky when one is right. But to be cocky when one is more wrong than right and then try to impress ordinary folks like myself that by inventing mambo jumbo one can catch all the valleys and peak of the market?

          Please be fair. Don’t just tell us that one can make money by holding a well managed company over a long period of time so we should gamble!

  34. Markab

    Gold goes up a whopping $7 after losing $200 over the past several months and everybody thinks we’re off to the races. If the past is any predictor, this gain in gold will be followed by a $20-30 drop tomorrow or Friday. Meanwhile, the stock market “SCORCH” is indeed a scorch…HIGHER. Wake me up with the S&P is down to 1700.

    1. RonL

      Markab we will wake you but if you are long here on the S&P you will loose your shirt by $1700. But I will wake you up so go away until then.

  36. jeyragusa

    Dang Alex. VIX is firmly GREEN while SM up 0.8%. I do believe that someone (you say smart money) is buying protection. You may be getting close to being right about your SCORCH.

  37. Don

    The S&P is starting to look like it’s going parabolic. The Biotechs are going in the opposite direction…what is the opposite of parabolic?

    1. ted

      Yup, but he wont admit it. He got caught on the wrong side. But we need dem bears! More fuel for the fire!

  40. Don

    Caterpillar has been soaring, pulling the DOW up with it. This is a company that has been experiecing declining sales for years and yet the stock is soaring. I guess that makes sense to someone.

    1. GMoney

      I totally agree with you. The price of CAT is trading like a 1999 Dotcom stock. CAT has had 42 quarters of declining sales and used CAT equipment is selling for pennies on the dollar. Yet the stock is trading higher now than at the top of the 2007/08 housing bubble. I haven’t seen anything this bizzarre in a long time.

      1. WallStreetJesus

        CAT is going up because of the infrastructure spending that will happen when Trump takes office.

    2. jeffd5584

      Much of this stuff (especially the flagpole rallies) could be easily explained by severe short covering (major dislocations everywhere). 20-30 years ago, the markets didn’t have tens of thousands of complex hedge funds trading long vs short and doing all sorts of complex derivatives type “side bets”…So they get killed in bonds or yen or something and all of a sudden, everyone figures out fund xyz is short CAT. Just to illustrate this point, some of you probably remember the big fund that got caught long some absurd stake in a major pharma company last year. Within a day (maybe the same day), the other major positions of this said fund were broadcast for the piranha’s to jump in and squeeze those as well…Now multiply that by 1000 or 10000 and you can get a better grasp of how broken all of this stuff really has become…

      Plus, 8+ years of nothing but QE and other CB “zombie market’s”, thousands of funds closed, retail investors gone for good and this thing is a creation of Dr Frankenstein.

  41. jonsyl

    vix vs equity rally is quite the contradiction. Worth watching, if it persists end of day, may be worth a shot at a short for me. any other takers???? LOL How about you Alex, just kidding, all of us get trapped at times.
    Gold is worrysome in here, some of the premium miners aem, fnv, negative in spite of gold holding in. May have to cover my buy and not wait for a 1150 stop. Just too many still bullish. Gary says 22 percent, same as dec lows which is good but can go lower.

    1. Spanky

      Too many bullish??? I don’t get this? If this is a bull market, sentiment should never ever get too negative. Look at the stock market for gods sake. I’m tired of people saying sentiment is still too bullish in gold. Really? Maybe if it is in a bear market still, then yes I agree with you, but then why the hell are you waiting to get long a bear market???

  42. Robert

    Gold giving back all gains as usual. Its a pattern of buy dips and sell rips. Anyone buying and holding not making money. Gary can gold still go 1158 or below again in this cycle?

    1. Spanky

      Yeah, it is frustrating for sure. It will Ben under pressure at least until the FOMC meeting. It will never ever get a serious bid before then.

  43. Spanky

    Dow will probably tack on another 700-800pts before it goes sideways again. You want a bubble, it is just getting started in the Dow.

  45. Spanky

    Quite the reversal right now in mining stocks. If they close the day lower than they opened, more weakness ahead guaranteed.

  49. Spanky

    Piss poor day for silver miners relative to the metals. Not a good indicator. Maybe they can make up some ground into the close but right now doesn’t look good.

    1. Dday

      “…Piss poor day for silver miners relative to the metals”
      It was a piss poor day for the metals as well. Weak bounce

      Silver looks like it can’t breach 17.30(beginning of resistance). Which is probably miners haven’t rallied.
      Here’s a chart

      http://invst.ly/2wi0e

      If silver can get above 17.80 i’ll become interested. At the moment just looks like a short term bounce.

      Here is a more detailed daily
      http://invst.ly/2wi0w

      Macd histogram showing this bounce is nearly over. RSI,TSI and stoch almost overbought…

  50. Alexandru Popovici

    VIX refuses to decline anymore
    selling on strength is emerging too
    growth is on below-average volume.

    reshorting SPX is close by.

    2. Alexandru Popovici

      it is just retailers buying except for homebuilders – the only risk-on sector with genuine smart money reloasding since 2 days ago.
      except for hbuilders, all SM growth is rubbish.

    3. Spanky

      VIX can go up with a sharply rising market. Look at the last real bubble 1997-1999. Vix went up with a skyrocketing market.

  51. chrisG

    Sold AG and my silver longs and my Steel for yummy profits!!! Will look to buy back. Before fomc, unlikely to have monster runs. This $1 rally in silver will rest.

    Scorched stock market? It looks clearly melting up. Lost a bit on my index short. Ain’t shorting. Rrshort on January. Heavily long some tech stocks. Let’s see

  52. Spanky

    Black candle in GLd and the miners actually rallied back to the 20 DMA. They are ripe for another vertical plunge downwards now.

    GLd daily full stochastics have been oversold for 5 weeks. That is flat out not natural market behavior IMO. Very similar to last November-December, but this is even worse this time. To me it is a symptom of synthetic supply and you really only see these type of statistical anomalies in PMs and currencies. This is one in a million type action IMO. No real market acts like this.

  53. Spanky

    Black GLd candle right on the 10 ema. Prepare for a gap down tomorrow and possibly a very big gap down.

  54. Spanky

    They are going to erase the weekly candle in Slv by end of day Friday. Back inside the bear flag. Just watch.

  55. Goild

    Today we had a failed ‘good’ day in gold. Though NUGT is up 3.6%
    This reminds me of October 23th when the miners started strong to loose steam; the following day on the 24th there was a big drop in NUGT.
    Today gold did not respond quite well to the drop in USD.
    However, currently gold is more responsive to TIP which happened to survive the equities jump.

    Just in case there is any doubt , I am quoting below old turkey.

    “You know, it is a bull market”

    1. Dday

      Yep technically still a bull market all the way down to $900, but that wouldn’t help anyone holding miners if it fell that low.

    1. Dday

      He’s been kind of right;
      -dollar rally
      -fall in gold after failure to break $1400

      But agree he’s taking a beating on stocks.

  59. Alexandru Popovici

    SM is topping the similarly to OCT2014.
    I am not shorting SPX yet – I wait for my moment and, you may not believe it, but I like the way SM grows: IT IS A BEARISH BULL 🙂 it is the kind of rise that exhausts.

    PS: VIX growing too on the same day that SPX jumps to fresh historical high on average volume and late in its daily cycle ?! What does it smell like? I am telling u, it smells like The Scorch.

    1. Spanky

      They will never let the market crash. The BOJ and SNB will step in and buy futures with 10000x leverage. As I have cynically said, we will never see a 10% drop in US markets ever again in USD terms, and I think even a 5% correction will never happen. This is a monetary and moral hazard phenomenon. At some point gold will go to the moon, but likely after they confiscate it and create a new monetary system. All liquidity is being pumped into the US stock market. Everyone knows it is TBTF!

    2. ted

      Alex, Alex, Alex, tuh, tuh, tuh. The Scorch is the EpiCenter of a Wave 3 that was due about now. You have seen nothing yet. As Gary said, this market may double before you know it. And in 5 years we could see DOW 50,000. And the bears will be crying all the way up!

    3. jeffd5584

      Alex, at least you are a contrarian. Sadly, comments on messageboards tend to become overwhelmed with sarcasm, pettiness and everything else in between. Trading/investing is an emotional roller coaster and most are not equipped to deal with it.

      The thing that sort of bugs me lately is that we do have a good number of cycle followers, but they’ve been drowned out by the overwhelming problems with the metals. A few months ago, even while the markets were doing the usual “drift” along, this was a more pleasant place and it was very constructive..i.e. “signal to noise” much better.

    4. jeffd5584

      Actually, I saw the same analog for the Dec 2014 period the other day. Similar structure in VIX as well. We also did a spike and retreat in early December last year as well…Another “Draghi disappoints” event. This rally, at this stage, is every bit the Oct-Nov 2014 “Bullard bounce”…Russell most closely resembles it. My instincts tell me that you wait for Russell at about 1380 area to short and then it will deliver something spectacular. The faster they pump these artificial indicies, the more emotion they generate.

  60. Alexandru Popovici

    swingers, go SHORT USDJPY – the end of this week will belong to JPY and gold/miners!

    1. Spanky

      I think you are going to be catastrophically wrong on that. There is no fundamental floor on Yen right now. And bounce it gets Ian pure technical buying/covering.

      The US and world Central banks have created the biggest moral hazard the world has ever seen IMO–that being the US stock market.

      1. jeffd5584

        Yes, agreed Spanky. Even when the stock indicies “bottom” nowadays, it’s usually in the middle of the night (European trading hours) and met with some sort of “binary” event. Brexit, Trump, Italy…I suppose that is why a day like today seems so damn odd…these are the type’s of moves we’ve become accustomed to when there is an actual “event”. Not just one of those typical drift higher, drift lower, algo-chop and then close unchanged. Sadly, the moral hazard that you speak of has so completely overwhelmed the markets that there isn’t any real “market” left. 12-15-20 years ago, there was a market, traders traded it…prices would ebb and flow a bit (not that it was ever easy), but the near constant presence of some Central banker somewhere wasn’t the modus operandi. In fact, most people would have been hard pressed to name the ECB head, the BOJ head…i.e. limited influence. Nowadays, people mention these figures at the same level (or even more powerful than most world leaders).

        Moral hazard indeed.

  61. Paul

    I am new to this blog: but here is my two cents- $XAU on weekly basis needs to close above approximately above $86.00. With the weekly CCI crossing the center line -0- . Last week the cci moved -100 failure to continue would just be another bounce, just like a few weeks back that stepped lower. Give it up Gary- his chart is correct as is his location of the Trendline. I signed up for this blog and have following Gary for sometime. Initially found his articles in Investing.com. I like Alternate views on the Market. My interest is in Swing Trading ETF’s. Thank you Gary…

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