GCZ15 – December Gold (Last:1159.90)

We saw gold’s rise steepen last week as the tempo of the stock-market plunge picked up. Under the circumstances, shouldn’t Friday’s climactic selling on Wall Street have produced a corresponding surge in the price of gold?  Instead,  bullion futures rallied to a modest new high Thursday night, only to recede and go flat while investors verged on panic the following day.  We’ll give gold the benefit of the doubt for now nonetheless, since the lesser charts remain bullish. But we should play close attention to the bearishly impulsive abc pattern that took shape on the hourly chart as the week drew to a close.

Specifically, if the pattern shown exceeds its d target, that would be warning of possible weakness ahead. The point c high, and therefore the target, will remain speculative until the futures begin to trade on Sunday night. Alternatively, if quotes move higher from the get-go, that would alleviate any suspicions we might be harboring about the robustness of the bull trend. In such circumstances, an 1181.00 target would obtain, subject to an upside breach of the 1164.80 midpoint resistance with which it is associated.  The bullish pattern is noted with green ABC coordinates; the bearish pattern, with lower-case red ones.