August Gold looks bound for a minimum 1903.90, but if that Hidden Pivot support gives way, look for the downtrend to continue to at least 1875.00. (A related p2 support at 1906.40 could also engender a precise, tradeable bounce). Both of those numbers can be bottom-fished with 'reverse' patterns and a theoretical trigger interval of $11. Since that would imply entry risk of more than $4000 on four contracts, you should initiate the trade only via an rABC set-up on the 15-minute chart or less and initial risk held to no more than $200 per contract.
Yet another week of tedious slop produced no change in my bullish outlook for the intermediate- and long-term. For now, August Gold's correction is targeted on 1903.90, a 3.5% drop from last week's settlement price. Neither bears nor bulls have shown more than slight interest in bullion since early March, and both will likely be bored out of their minds before the bullish trend resumes in earnest. The first hint of this would come on a pop above 2006.20, the 'C' high of the pattern shown. Otherwise, expect the weak, downward dirge to continue. ______ UPDATE (Jun 16,): The presumably meaningless rally that ended the week triggered the fourth 'mechanical' short since May 30. The first three produced a theoretical profit of $10,000 apiece on four contracts. Here's a fresh chart that shows gold's pooch-screwing price action. _______ UPDATE (June 20, 1:58 p.m.): With gold in its wonted gold-is-garbage mode, the 1903.90 downside target is looking increasingly likely to be reached -- and precisely, given the umpteen bounces the futures have taken from p=1956.10. An arguably even more appealing pattern projecting to 1892.10 will be in play if 1903.90 is exceeded by more than $1.00 or so. I say 'more appealing' because of the pert little alternative one-off 'A' at 2087 recorded on May 4.
Last week's bullish feint triggered a less-than-appealing 'mechanical' short at the green line (x=1980.60). The selloff into the close was bound for a retest of p=1955.10, but if this 'hidden' support fails, look for more downside to 1929.50, the secondary (p2) pivot. Bears have had trouble doing serious damage, so there's no reason to think the downtrend, a correction from May 4's 2102 high, is likely to reach the D target at 1903.90. That implies p2 should be bottom-fished, presumably with a reverse pattern of small degree (aka 'camouflage'). ______ UPDATE (Jun 5, 6:59 p.m.): We'll let gold bulls, bears and the Wharton-educated criminals who manipulate them bayonet each other bloody for a while, but by all means please nudge me in the chat room if you see easy money sitting on the table.
I've displayed a weekly chart because it makes the turgid price action of the last several weeks seem not so much depressing as tedious. Nasty, gratuitous swoons in a bull market that has yet to attract an institutional following are inevitable, but we should always keep in mind that bears do not have the power or the moxie to sustain damage. The June contract could come all the way down to x=1816.60, in fact, and still look fine. That would trigger a succulent 'mechanical' buy, even through the implied $128 fall from here would likely ratchet up despair amongst gold's fair-weather supporters.
June Gold would become a tempting 'mechanical' buy on a pullback to the green line (x=1816.60). Failing that, we might expect the futures to continue to jack bulls and bears alike with the kind of skittishness that makes trading such a challenge. For all the histrionics we endured last week, settlement was little changed from the week before. Other than an uncompelling voodoo number around 1930, there is not much to recommend for trading purposes as the new week begins.
I've used a pattern similar to the one in Silver to show that both are in a precarious place, poised to fall at least 2% if their respective midpoint Hidden Pivot supports are decisively breached. So far, the pivots have held, but we'll need to monitor price action closely this week. Like July Silver, June Gold is a spec buy at the moment, presumably using a reverse-pattern trigger on a chart of small degree. Doing so on the daily chart would risk a little more than $1000 per contract initially, far more than the $150 or so we should be willing to part with. _______ UPDATE (May 16, 5:22 p.m.): June Gold has fallen into the bog of weak consolidation that occurred in the last two weeks of April. The most bulls should hope for is that the futures rebound sharply after maliciously dipping beneath the bog's low point, 1980.90 on April 19. Here's the chart.
Yes, it's a bull market, but not one that has been much fun. My current rally target is 2138.30, just 134 points above Friday's settlement price. Riding this bee-stung Brahma became particularly unpleasant last week when a vicious spike up to 2085 on Wednesday reversed precipitously to finish the week just slightly above where it began. For the record, the dive on Friday triggered a 'mechanical' buy at the green line (x=2020.30), stop 1980. The usual caveats apply. ______ UPDATE (May 12): The 'mechanical' trade was worth as much as $3,600 per contract, although it generated little buzz in the chat room. The 2138,30 rally target remains viable.
I seldom display charts that contain two technical indicators, but in this case I wanted you to see the whole picture, which projects a likely drop to D=1943.50. The June contract has been pounding on the lower support of a channel for two weeks, but when it finally gives way, expect it to head down to D, a middling Hidden Pivot support. The pattern is gnarly enough that it should allow for bottom-fishing with a tight stop-loss (or preferably a minor 'reverse pattern' trigger). Please note that the futures have been on a 'mechanical' sell signal since rallying to the green line a week ago. ______ UPDATE (May 2, 6:20): Gold continued its wacky, daily swings with an explosive rally that exceeded the point 'C' high of the bearish pattern targeted on 1943.50 (see above.) Now. if buyers impale p=2029.70, look for more upside to D=2078.40 over the near term. ______ UPDATE (May 3, 6:18 p.m.): The futures got even wackier after the close, spiking nearly $50 to a so-far top at 2085 that lay 0.3% above my 2078.40 target. A wrenching $30 swoon [Update 5/4 at 8:36 a.m.: The swoon is currently $47] has followed, but hysterical buyers are probably still out there in droves. If they lift the lid anew, the futures could be bound for a more durable peak at 2183.30. A vicious pullback in the meantime to 2020.00 would trigger a 'mechanical' buy, stop 19https://bit.ly/3ND4uvY80.00 (A=1906 on 3-15). Here's a fresh chart.
Gold has been leaden for a month, presumably to set up a nasty surprise. But for whom -- bulls, or bears? My hunch is the latter, but we'll keep an open mind just in case. They evidently were fixated on the 2050.60 target shown in the chart and may have been patting themselves on the back when the futures whipped around and shot up to a marginal new high that stopped every last one of them out. We shouldn't underestimate the lingering pain, nor their natural desire to even the score. Look for wicked swings to precede a drop to at least p=1939.10 if there's going to be a consolidation for another big leg up.
Buyers on a roll for the last month have 7'd out just above the 2050.60 target shown. An alternative target at 2079.40 still looks likely to be reached, but probably not straightaway. The lower target must have been widely anticipated, since the futures head-faked above it a week later just to jack shorts who would have been celebrating the refreshing but short-lived $54 drop a week earlier. We'll focus on short-term opportunities for the time being, with a mildly bearish bias. _______ UPDATE (Apr 19, 11:45 p.m.): My explicit guidance for getting long this morning produced a winner that could have been worth as much as $9,600 on four contracts. Traders would have experienced little stress on the ascent, since the trade proceeded straightforwardly from a voodoo number that caught the intraday low to the exact tick. Here's the chart. For further details, and to determine whether you could have followed my instruction, see related posts from 8:12 a.m. forward. _______ UPDATE (Apr 20, 10:52 p.m.): Navel-gazing has driven gold psychotic, even if its price action is as predictable as ever. The June contract is currently bound for the 2028.80 target shown in this chart -- and yes, it is shortable if you know how to manage the risk tightly. _______ UPDATE (Apr 21, 8:22 a.m.): The bearish, 1963.00 target in this chart goes against gold's daily drug habit of reversing overnight smashes as the regular session begins, but that's what will happen if sellers break p=1993.80 decisively. If you're planning on bottom-fishing, be alert to the possibility that using the slightly higher 'A' available in the chart could lower the bottom from which the futures are likely to bounce to 1961.60.
