In the 1970s, gold rallied sixfold and then pulled back by almost half, yielding a large-scale D target in the area of $262. Practitioners of hidden pivotry, had they existed at the time, would have been well served by a tight stop, given that the price went, oh, about six hundred dollars higher. After surpassing $262, the chart curved up toward vertical. Gold’s current bull market seems to have done the same thing recently. The largest structure of the last ten years, with the BC leg occurring in 2008, gave us a D target of $1460. During the last ten months or so, the market approached that target warily, popped through it, returned to it, and after a rally took one more shot at it. Since that low on July 1, however, the turn toward vertical seems to have begun in earnest. What to make of the $200+ decline last week? If you answered “a BC leg,” congratulations. The obvious A point was on July 1, and the pattern is active with a D target of 2142.30. The midpoint comes in at 1923.80, just above the all-time high which serves as our B point. The pullback is itself a bearish impulse wave, but it has already retraced by more than half, meaning that a decline to its midpoint of 1735.30 would leave the larger bullish pattern intact. Follow-through all the way to the bearish D target of 1629.00 could happen, of course, but don’t hold your breath for that. Traders should play any approach to 1735.30 from the long side, using appropriate Hidden Pivot tactics. We’ll zoom in further starting tomorrow. (Posted by Doug “harry” McLagan)