Gold is close enough to the depths of despair that we might hope for a rally. However, since hoping is for losers, we'll just watch and learn to like it as the futures swirl down the crapper. Ordinarily, Friday's slight overshoot of D=1865.20 would be no cause for alarm, but in this case we'll infer the worst -- i.e., that the support should have held if gold were ready to turn. If you want a slim reed to grasp, use the 1855.40 target of this gnarly pattern. It's okay to back up the truck there, but only if you use a very tight stop-loss. (Note: I have not boldfaced and colorized the target because I don't want to draw attention to it.) _______ UPDATE (Oct 2, 9:19 a.m.): The $7 rally from within less than a dollar of the number given above would barely have paid for a Soho lunch, although the very tight trigger interval (TI) I'd advised would have prevented a loss. The subsequent relapse means gold is still in gold-is-garbage mode. A little overdone, don't ya think? _______ UPDATE (Oct 2, 11:07 p.m.): The futures look bound for the 1777.10 target of the reverse pattern shown here. I am awed by the viciousness with which the bullion bankers and their scummy friends in high places have defenestrated, drawn-and-quartered, impaled and flayed those who might have intended to take delivery on September COMEX contracts. When there's no 'physical' available to supply, Their solution is to crush demand.
Putting aside the depressing question of how low Silver could go, the 21.75 downside target of the pattern shown is pulsating with opportunity. It's the legit (i.e., non-sausage 'B' low) that brings this picture together. I have not boldfaced the target (or a similar one in gold) because I don't want to queer its potential magic for purposes of bottom-fishing. The daily chart requires a large trigger interval of 37 cents, but I'll suggest looking for a smaller 'natural' trigger on, oh, the 15-min chart when the futures get within 25 cents of the target. _______ UPDATE (Oct 2, 11:28 p.m.): This chart shows how the trade suggested above could have produced a $1,200 win on four contracts going against today's overwhelming downtrend. The 'natural' trigger shown was the only available choice, and it yielded an interval of 5 cents. However, the trade was signaled at 6:15 a.m., well before the regular session began, and many of you have been asleep.
I've reproduced a chart that goes back to 2019 in order to show clearly that there has been little drama in more than three years. Comex futures are trading about where they were in the summer of 2020, meaning there has been no net gain since then. The chart is unmistakably bullish and projects to as high as 2326.30 (basis the August contract), but that doesn't mean gold couldn't fall by $200 or more before it heads into, if not the wild blue yonder, then perhaps toward a towering cumulus cloud on the horizon. A pullback to x=1864.10 in the meantime would trigger a 'mechanical' buy with excellent odds for success, but we'll wait until it gets there before we discuss entry tactics.
We can dream about Silver's rise to the 36.24 target shown, but for the time being that's all it is: a dream. That's not saying the December contract could not break out within the next 8-10 weeks with a fist-pump above the 27.46 peak recorded in March 2022, but until that happens there is no point getting all het up about the prospect. At the moment, Silver has been tough merely to trade, since the futures have oscillated mostly within a single Hidden Pivot band for ten months. They are also trading toward the middle of a wider range that has persisted since July 2020. Bottom line, if you see anything even remotely interesting in this chart, you are hallucinating.
Gold is in an obligatory bounce from the green line (x=1934.00), and any long positions initiated there would be showing a paper profit of around $4400 on four contracts. The futures would need to hit p=1954.30 to signal a partial exit, but bulls looked sufficiently energized to accomplish this when trading resumes Sunday evening. I have my doubts that the run-up will reach D=1995.00, though, in part because the turn from the recent low looked too agonized. Regardless, 1995.00 is theoretically in play and would become an even better bet if the rally impales the midpoint Hidden Pivot on first contact. _______ UPDATE (Sep 18, 9:17 p.m.): The textbook 'mechanical' buy that triggered a week ago at x=1934.00 has gone on to produce an $8000 gain for anyone who did the trade. It is time to realize half of your profits now, since the futures this evening have touched the red line (p=1954.30) as anticipated. Here's the chart. _______ UPDATE (Sep 20, 8:20 p.m.): The vicious bull-trap stab this morning to 1069 was short-lived, but it gave anyone still long an opportunity to exit with an additional $1800 for each contract still held. If you kept 25% of the original position for a swing at the fence, I'd suggest an 'impulsive' stop-loss at 1943.70 for now.
Silver finished the week on an upstroke, but the pattern that produced it may be too obvious to sustain the steep trajectory. The low occurred just a tick or two beneath mid-August's 22.58 bottom, implying the turnaround was just bulls and bears scaring themselves into action. That's nearly always good for a pop, since the former were stopped out and no longer on board to slow down the rally. The pattern should work for bottom-fishing a swoon to the green line (x=22.83) 'mechanically', but we won't be able to judge buyers' enthusiasm until such time as they interact with the 23.67 target of the rABC pattern. _______ UPDATE (Sep 20, 8:41 p.m.): Here's a mildly bullish chart to help you leverage Silver's churlishness. Because today's nasty reversal did not quite reach the red line on the upswing, I cannot recommend a 'mechanical' buy if its fall hits the green line.
Bulls and bears ended the week playing patticake, somewhat shy of the green lie (x=1934.0) where bottom-fishing would become mildly enticing. A one-level bounce seems likely, although the pattern's elongated B-C leg has diminished the bullish impulsiveness of this picture sufficiently to make a run-up to D=1995.00 less than an even bet. Although that's unlikely to stoke your enthusiasm, we should try nonetheless to get a piece of the implied 'mechanical' bounce that is indicated with a tight 'reverse trigger'. Tune to the chat room for possible guidance on this. _______ UPDATE (Sep 12, 7:59 a.m. EDT): The futures have in fact come down to the green line, implying it's time to set up a trigger for the 'mechanical' buy suggested above. On the hourly chart, the nearly 4-point 'natural' a-b is a little rich for my taste, so I am using a= 1947.30 (9-11 at 9:00 a.m.) to set up the trade with a $$1.70 TI. Based on the so-far low at 1933.40, the trade triggered a few minutes ago at 1935.10. First partial profit would be at p=1936.70. For comparison, the more natural a-b, where a=1939.50 on 9-10, would trigger at 1937.40, based on the so-far low at 1933.40. We shall see. _______ UPDATE (Sep 13, 6:20 a.m.): Although the small pattern got stopped out for a $170 loss per contract, the more 'natural' $4 trigger went on to produce a gain of $380 in about an hour. This is not bad, considering we went long against weak, sloppy price action. Here's an interesting chart from Erik Volma at Gold-Eagle.com. It shows what gold prices did during stock market crashes going back to 1970.
The futures tripped a reverse-pattern buy signal Thursday night and then went blotto on Friday, unable to poke above the green line for more than a few minutes after three tries. There was no reason to hold a position over the weekend, but if you did anyway please let me know so that I can decide whether to provide a tracking position. Usually when a clear signal like this one produces...nada, it means the dominant trend -- in this case down -- will continue. Since I don't have a crystal ball to predict how this mud-dog will open Sunday night, I will wait for it to instruct me. If I had to guess, I'd say traders will scare themselves to death with a gratuitous feint beneath C= 23.13, paving the way for a weak bounce that will not likely be tradeable unless we're glued to the 3-minute chart.
The bullish pattern we used last week to leverage a 1995.00 rally target is still viable, even if there haven't been any pullbacks sufficient to trigger a 'mechanical' buy on the daily chart. That could still occur on a swoon to the green line (x=1934.00), or to the red line, where a somewhat riskier trade would be signaled. More upside to the 1995.00 target is not in doubt, however, given the way the futures punched through p=1954.30 last Monday. We'll look at other ways to get aboard, so stay tuned to the chat room if you care.
Last week's top occurred an inch from the 25.34 target of a reverse pattern stretching back to July, so I've lowered its point A to June's bottom to produce a new, somewhat higher rally target at 25.74. A further drop to p=24.16, or to x=23.37 could cue up a 'mechanical' buying opportunity, although the latter would be somewhat less risky. The stop-loss for a bid placed at the higher level would be at 23.63, but check for timely guidance in the chat room, since we may be able to cut risk significantly. The predicted move to at least D=25.74 comes with high confidence, given the easy penetration of p=24.16 on the way up. _______ UPDATE (Sep 6, 6:41 p.m.): Now that the futures have come down to the green line (x=23.27), you can use a trigger interval of 28 cents to get long. That implies entry risk of about $1400 per contract, so the trade is advised only for subscribers who can locate the trigger pattern. Based on Wednesday's low at 23.31, the buy signal would come at 23.595, with a partial- profit-taking exit at p=23.875.
