Gold’s rally since the beginning of 2007 is most encouraging, but how can bulls be sure they won’t get sucker-punched yet again if they climb aboard at current levels?  Using judicious trailing stops and nailing down partial profits is an obvious answer. But another is paying close attention to each rally leg, noting in particular how many prior peaks it has surpassed on the daily chart.  Below, I have reproduced a daily-bar graph of Comex April Gold that shows five such peaks that will dictate our analysis in the weeks and months ahead.

Note that, with yesterday’s strong surge, the futures have exceeded peak #1, as well as a very minor peak labeled ‘X’. This modest feat has created a bullish impulse leg of daily-chart degree, but it is only a weak impulse leg so far. To be confident that there is sustainable power behind this rally – enough, perhaps, to drive bullion quotes to new all-time highs -- we should stipulate that the current thrust continue, without a pullback lasting more than a single day, to exceed at least two more peaks (#2 and #3). That would leave little doubt that the correction begun in May had ended, although it would take a push above peak #5 (a mere dot on this chart, albeit a significant one from a Hidden Pivot perspective) to definitively end Gold’s long wallow.

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London Seminar

A Hidden Pivot seminar in London appears likely, judging from the strong initial response.  If you’re interested in attending a two-day class there, probably sometime in the spring of 2007, please let me know via e-mail, including your contact information. The cost would be $1,500 USD.