A symmetry target on the weekly charts, applying a doubling of the move up from 681 and adding to the recent swing lows, points toward approximately 1190. Interestingly, the monthly charts can point there too. Applying a 1.382 extension to the drop on the monthly charts from 1033 to 681 (as if this could still be part of one large (B) wave movement), calculates to 1167. These numbers are all close enough, and have significance in enough time frames - weekly, monthly and yearly - that I must point them out. Readers know that I've been working with these bullish and bearish alternatives for a long time; also, I see that Tony Caldaro has been too, with his more bullish count marked as preferred count on his gold charts (as I posted a while ago, use the "Gold" label at right to see prior posts on this).
Some factors for the bullish case:
- If gold were going down in a (C) wave, it shouldn't be as strong as it's showing now.
- The shorter-term technical indicators have moved up smartly, although the longer-term indicators haven't followed suit yet. Generally, the technical indicators moving into a more positive position.
- Chris Carolan's comments at Pothole or Not? (5/21/09) · "Does the pothole for gold prices foreseen by the solunar model occur? Or is this break above the weekly net-line a strong enough signal that propels gold prices to the 1064 area of the upper weekly channel? The bottom line is that any seasonally inspired gold weakness should be temporary. The larger trend is up, and the corresponding technical picture is healthy for the yellow metal." See his updated Solunar chart at his post there (which does show the next move as another drop into mid-June however).
- Comments by both Merriman and Armstrong that point out, whether or not the dollar pulls out of its swoon, gold is seen globally as a currency alternative (and as I think on it, countries around the world seem right now in a contest to see which can devalue its currency more for economic competitiveness purposes - so if they're all trying to weaken their currencies, maybe that's bullish for gold!).
- This finally kicked in - there have been news accounts of individuals selling their gold and gold jewelry, and also that recent news story that people haven't been buying much gold jewelry lately. Maybe it is a contrarian indicator. Then again, all those TV ads touting gold coins has me worried. (Has Mr. T surfaced again? (Check out Minyanville's "Mr. T" gold indicator!)
Some factors for the bearish case:
- Gold has not yet managed to surmount 1008 so that remains technical resistance.
- The MACD on the weekly and monthly charts still looks like a "bear kiss" that can send gold significantly down again. Generally the slower-moving indicators aren't bullish, yet.
- Gold contract commercial traders remain bearish, even increasing their short positions as of May 19. They aren't always right, but the disparity between their positions and those of large and small speculators remains sobering.
The tensions between the bullish and bearish case could become one reason to support Chris Carolan's projection of more weakness for a few weeks (maybe it becomes an EW triangle, if that makes any sense on the charts). Thinking more cynically, another reason would be if the commercial traders need some time to shift their portfolios and positions to net long, and to do so before another leg up really kicks into gear (i.e., to do so while prices remain more favorable for shifting from net short to net long). Or maybe it's just that the opinions on each side are so strong, that a standoff may continue for a while. Once any standoff is broken - we'll use the levels I've described, to look for the next station the gold train wants to visit.
Below are charts, I'll place some comments in front of each. First my daily chart, I added new trendlines supportive for the bullish case. If Chris Carolan's projection of another pullback happens, then it can do so and still receive support at these trendlines. I also placed on it a couple of new annotations about the projection toward the 1190 area. The 1192 projection is an old one, but the symmetry target from 681 is a new calculation and included in the annotation. I didn't get the "flat (B) wave up" projection to about 1187 into the annotated comment, but I would think my readers can keep that in mind too. The indicators on the daily chart look good.
My long-time weekly chart which has had a bullish fork for a long time, along with the 1192 number. Here, the MACD still looks like a bear kiss, but the StochRSI which moves quickly is up although might be just testing its midline (along with the Slow Stochastics indicators in the lower windows acting similarly). Notice that gold could also do a deeper pullback than the new trendlines on my daily chart, to the weekly chart fork channel, and still remain within the bullish fork.
Monthly chart with price envelope. Here again, the MACD still looks like a bear kiss position. But it hasn't "broken" on this chart yet either. With the price envelope, a push up above 1033 becomes an obvious breakout that should attract momentum buyers.
This chart I stumbled across, it is an old one from almost a year ago (back when I was a member of TTC and apparently another TTC member submitted it - I don't remember who it was). Interesting work and also interesting that price is now testing that same 960 area as it was back then. (Maybe just as I see 860 and 960, etc. as pivots for SPX, can be the same numbers for gold?) I added some markings and notes in blue onto it. The author had written "Too Steep?" and turns out it was, price instead reversed down to 681. But regained those trendlines and now my 1192 number can move up to the upper ones on this chart. Notice that here, too, there can be a lower pullback and still remain within uptrending shown on this chart. I don't know that those lines are the same as on my weekly chart but there may be some that have similar angles. Looking at the background "arc" that apparently was on this chart at one time, it also reminds me of a "French key" chart that another TTC member submitted once - quite interesting, I think it really incorporates a sort of spiral peaking curve, and it was also suggesting that higher numbers above 1033 could remain viable.
This one was a Wolfe wave chart that a TTC trading buddy submitted - crissy, if you see this, my cheers to you! I suspect that its target already was hit at 1007, based upon the angles shown. Notice that, while at the time we were discussing gold to 1200 as a Wolfe wave target, the chart target depicted was just above 1000 and not necessarily showing new highs. Also, when you realize and remember, that when gold hit 1007 in dollar-denominated terms, it was simultaneously hitting new highs in the euro and other currencies. So for me, this leaves open the question, does a Wolfe wave now also seek higher, to the 1192 level (right by the 1200 that we were discussing a year ago)?
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