Comex Gold Futures

I took my eye off the ball briefly when an abortive rally Wednesday night threatened to disrupt a promised pullback to at least 1090.20, but that's still the number to watch.  There's another HP support near there, as well as the trendline support shown in the accompanying chart.  A breach shouldn't be viewed as fatal, and in fact we'll be on the alert for signs of a devious breakdown, since nothing has changed to fundamentally undermine the bullish case for gold. Most immediately, the futures would need to pop to 1123.90 today to get back on a bullish track.

Wednesday's wildly idiotic price action reminded us of the days when the bonds were wont to act as though they had to do "something" nutty every time the Fed came out with a "more-of-the-same" announcement.  Yesterday brought more more-of-the-same "news" from the Fed, and gold traders went nuts for an hour before it dawned on them that the central bank's plan to keep administered rates exactly where they are was not exactly earth-shaking news.  Later in the day, around 7:40 p.m. EST, February Gold had recovered completely from its swoon and was poking above the spiky intraday high at 1142.50.  A no-brainer target at 1147.30 can serve as a minimum upside objective for Wednesday night (see chart).  That would get the futures past the first of three peaks immediately above, but at least one more peak would need to be smashed to imply that the correction is over.  Above 1147.50, the next interesting pivot is  1155.00.  ______ UPDATE (12:32  p.m. EST):  The futures are down $10 from their highs in deference to tonight's surge in the dollar.  The pullback  is not yet impulsive on the 15-minute chart, even, so you could say that Gold is holding up pretty well so far under the circumstances.  The 1147.30 target that had looked so promising would be negated by a print below 1129.30, a mere dollar beneath tonight's so-far low.  FURTHER UPDATE (3:10 p.m. EST):  The 1090.20 target I proffered here a while back is still the one to care about. I said I wouldn't touch February Gold until it hit that price, but an 1102.30 Hidden Pivot support that I posted in the chat room was too tempting to pass up. I advised exiting this scalp-trade at 1106.50, but the rally carried an additional $4, to 1109.60, before gold resumed its familiar trajectory.     ow gold minimum , as I originally had

The futures spent most of the day oscillating around an 1124.90 midpoint whose 'D' sibling lies at 1133.00. We'll make that our minimum upside projection for today while noting that that's not asking too terribly much of February Gold. An 1154.50 benchmark remains viable as the point at which we may infer bullion's corrective phase is over.  It would take somewhat less than that, however -- specifically, a print exceeding 1143.40 -- to invalidate the 1090.20 target that is still our minimum correction target.

Someone in the chat room said the bullish tripwire I've set at 1154.60 is a bit ambitious, and I agree. But nothing less than that will do if we are to be "sure" that the correction is over. Even so, opportunities to get long speculatively with almost no risk abound, and I've have sketched just such a one in the accompanying chart. Remember, an impulse leg need only exceed one internal and one external peak to qualify as such, and the subtler the better.  "Subtle" is what you will see in this chart, and it is patterns like this one that will allow you to test the water a half-dozen times a day, initiating speculative long positions that are likely to make you a small profit even if you're wrong and the futures fail to get airborne.  There are a dozen people in the chat room intraday who know how to use patterns like the one shown, so don't hesitate to ask if you're not sure.

We're using a Hidden Pivot at 1090.20 as our minimum retracement target for the near term, although a close look at the hourly chart reveals another at 1094.30 from which the futures could conceivably turn higher.  Either way, the February contract is likely to correct a further 1.8% or so before it would becoming an enticing buy.  Alternatively, buyers would need to push the futures up to 1154.60 today to stampede bears and end this so-far 9.5% correction. _______ UPDATE:  If Gold has bottomed and will not require a pullback to 1090, we needn't wait for an 1154.60 print to turn bullish.  Stay tuned to the chat room for camouflage entry opportunities.

Perhaps if we all stopped watching gold so hard for a day or two it would show less disdain for bulls and do what had come naturally until last week -- i.e., move relentlessly higher. In any event, we needn't debate our choice of benchmarks to tell us when buying has resumed in earnest.  Because the 1154.50 peak shown on the accompanying chart cannot tell a lie,  that's where we'll set a screen alert to wake ourselves.  If the futures instead fall Thursday night after having gone no higher than 1139.00, some key (albeit minor in the bigger picture) supports lie at 1123.30 and 1107.60. _______ UPDATE (3:48 p.m. EST):  Another lousy day for gold. I wouldn't touch the futures before they hit 1090.20, a Hidden Pivot that looks magnetic.  This kind of weakness, with gold getting dragged lower each day, kicking and screaming, will ideally produce a V-shaped low. 

Gold futures continued along their tortuous path lower yesterday, far from invincible, but nonetheless defiant. The nearest Hidden Pivot support of significance is 1103.50, but lesser patterns promised relatively low-risk bottom-fishing opportunities above it.  My suggestion is that you use 'p' midpoints to do so -- most aggressively when the patterns that have produced them evince the gentle arc of the one shown in the chart.  Best possibility as of 9:30 p.m. EST would come on a swoon down to 1122.00.  Bulls can get excited if a rally exceeds 1154.50 0vernight or Thursday morning, since that would create a  quite bullish impulse leg on the hourly chart. _______ UPDATE (9:44 a.m. EST):  Using the 1122.00 pivot flagged above would have caught the best trading opportunity of the day, since the futures bounced $11.50 from a 1121.80 low.  The bottom occurred at around 6:20 a.m.  If you caught the ride, treat yourself to a Havana -- or your parrots to some of that fancy Cuban bird seed.

It took gold four tries on the hourly chart this week to take out the panic low at 1135.80 recorded on  November 27, so we should still not be entirely impressed by this selloff. Hidden Pivot aficionados will probably come up with a 1094.30 target, using the ABC coordinates shown in the accompanying chart. That might prove to be the case, but 'B' is pure sausage as far as I'm concerned -- indicative of a downtrend that lacks real guts. If you want to be sure, I'd suggest monitoring the lesser abc patterns on the 3-, 5-, and 15-minute charts. For bulls, the good times would begin to roll on the 3-minute with an 1140.50 print.

February Gold created a bullish impulse leg on the hourly chart without having reached the 1133.70 downside target proffered in yesterday's tout.  This is quite bullish on the face of it and suggests that the correction from last Wednesday's 1227.50 peak has already run its course. We'll hold bullion to a higher standard, however, and continue to monitor its vital signs each step of the way.  At the moment, our benchmark is an 1181.50 rally target, assuming the futures can first get past its sibling midpoint at 1167.50.   The bounce so far has gotten as high as 1164.20, so bulls will need to do a little better to earn safe passage to the 1181.50 Hidden Pivot. Traders and night owls should look for camouflage opportunities near 1160.30, since that's where a buy signal was triggered during the night session. The signal will remain valid as long as there's no dip below 1153.20, the point 'C' of the pattern. _______ UPDATE (9:50 a.m. EST): The futures aborted the rally to 1181.50 in the pre-dawn and have since taken an unconcvincing dive lower.  A re-test of Monday's lows near 1136.00 seems likely, but in any case, it would take a print of at least 1177.60 to turn the lesser charts decisively bullish once again.