A 1273.80 rally target has kept us on the right side of the trend for weeks, even when gold looked pretty tired for stretches lasting as long as 3-5 days. Now is a good time to let the bullish imagination run, however. To trade gold futures, we’ve been using a relatively minor ABC rally pattern that seemed to unfold at a glacial pace. However, if you view this price action as a consolidation within a significantly larger pattern, it makes more sense. I’ve reproduced a chart that shows this clearly, with a ‘k-A’ segment that Pivoteers will see as commensurate with the scale of the correction of the last three weeks. Most immediately, the pattern raises our minimum upside objective to 1287.80, the midpoint Hidden Pivot. But it also establishes an intermediate-term target as high as 1384.10. That’s where I think this rally is headed most immediately before it takes another significant breather. Meanwhile, p and p2 can be used to initiate long trades and to manage the risk of ongoing trades. We’ll have no fewer than three enty strategies at our disposal — mechanical, counterintuitive and camouflage — so stay tuned to the chat room in the coming weeks if you seek guidance in real time.
