There are signs that precious metals may be breaking out after correcting since August. That is why I am featuring a longer-term chart with an ambitious target at 2166.90 that equates to a 15% move above current levels. The pattern tripped a theoretical buy signal at 1867 two weeks ago that is associated with a midpoint pivot at 1967.10 we can use as a minimum upside objective. We should allow 2-3 weeks for the rally to play out. That’s assuming the four-month retracement bulls have just endured has discouraged enough of them to lighten the burden of their profit-taking on the way up. Please note that the February contract still needs a modest push above November 16’s 1904.30 ‘external’ peak to generate an impulse leg on the daily chart. It would be the first since April. ______ UPDATE (Dec 21, 5:57 p.m. EST): The bad guys used pandemic news to smack down gold in thin trading overnight, but they failed to inflict any further damage after activity began to pick up Bulls could tactically concede a little more ground, but watch for them to turn things around decisively from p=1868.30 in this chart. _______ UPDATE (Dec 22, 8:25 p.m.): Apologies, since I neglected to link the chart I’d prepared for last night’s update. Here’s a new one, however, that offers a somewhat more bullish prognosis for those who got long. It shows a midpoint Hidden Pivot support at 1866.60, $1.70 below the one given previously, where a tradeable bounce was likely. A bounce has indeed occurred, but the small breach of the red line will warrant caution. This means taking a partial profit this evening, with the futures trading $3 above the original entry price; and using a break-even stop-loss for what remains. Another partial profit is suggested if the green line is reached. Thereafter, you can swing for the fences with what’s left, since the significantly higher targets broached above are still in play. _______ UPDATE (Dec 23, 9:18 p.m.): Two lower lows this week, both of which fell a mile short of the secondary pivot at 1854.40, would have stopped out most longs, leaving us to spectate while gold continues to screw the pooch. There may not be much oomph behind the rallies, but bears aren’t scoring either. Bulls have the edge at the moment, and you should assume they’re capable of hitting 1897.20 if they can close this rabid mongoose above 1885.80. That’s the D target of the small pattern at the rightmost edge of this chart.
GCG21 – February Gold (Last:1882.70)