Re-read my last tout for August Gold if you have yet to attempt a ‘mechanical’ trade, since the buying strategy I’d advised worked almost perfectly, producing a theoretical profit of $1100 per contract with relatively little stress or pain. You be the judge as to whether you could have followed my instructions. On Thursday night, I had suggested buying on a pullback to 1268.10, a secondary pivot shown in the chart. The trade tripped at 2:00 a.m., but you could have gotten aboard at or very near that price until 8:00 a.m. The 1264.60 stop-loss I’d advised proved more than adequate, since the futures went no lower than 1267.30. They finally got airborne around 8:00 a.m. with a rally that two hours later hit the 1278.50 rally target we’d been using all week to keep us on the right side of gold.
So what’s next? The slight overshoot of 1278.50 is mildly bullish, but we should hold our exuberance in check until such time as the rally surpasses the 1292.40 ‘external’ peak recorded on May 16. If and when that occurs, it would put a target at 1382.80 in play, and even moreso once the 1288.00 midpoint pivot associated with that target has been decisively exceeded. The pattern can be replicated on the 240-minute chart using these coordinate: A=1074.00 (1/14/16); B=1263.60 (2/11); and C=1193.20 (2/16). _______ UPDATE (June 13, 9:42 p.m. EDT): The rally stopped at 1290.30, just shy of the 1292.40 bullish threshold noted above. All we can do now is remain patient. _______ UPDATE (June 14, 7:48 p.m.): The futures poked slightly above the 1292.40 benchmark noted above, but that should suffice to refresh the bullish energy of the hourly chart. If so, for starters we should see a pop overnight to the 1297.70 target shown. (See inset, a new chart.)