Our large-scale bearish patterns for gold are alive and well after yesterday’s aggressive test of the lows, but in the meantime the stage is set for upward impulsiveness and potential camouflage for buyers. The attached chart shows no fewer than eight prior highs that could be wiped out by a small rally. Of special importance is the one labelled at 1564.40: if the futures should surpass it narrowly and then pull back, as shown by the hypothetical dotted line at right, our criteria for camouflage would be exquisitely fulfilled, and traders should buy the ‘X’ entry point with both hands, placing a stop under ‘C’ as shown. If instead gold resumes its downtrend, the pivots and targets mentioned in yesterday’s tout remain in effect, except for the midpoint at 1538.40 which was broken. (Posted by Doug ‘harry’ McLagan)
