The gold price declined enough on Tuesday to confirm a robust pattern that projects down to 1453.40. The midpoint of this large pattern is only five ticks below the important low of 1526.70, meaning that it is not hidden: to buy the midpoint would be to buy last week’s low along with countless other traders, which is not our style. The “D” target of 1453.40, although well-hidden by our criteria, is less than five dollars above the level ($1449) at which the long move up from the 2008 low would be retraced by the Fibonacci value of 38.2%. Traders should be aware of an alternate version of the pattern with A=1648.00, which yields a midpoint of 1538.40 and a “D” target at 1477.70. If the current session low of 1554.50 holds (or is only narrowly surpassed), a rally of $17.20 will confirm a bullish pattern with A=1530.40 and targets that traders should calculate at the time. (Posted by Doug “harry” McLagan)
