Gold

Gold's pointless histrionics have been surprisingly tradeable, albeit only by Pivoteers who know what they're doing. Notice how Friday's stupid spike early in the session reversed from the secondary Hidden Pivot at 1782.70. Any rABC pattern one might have used to set up a short would have worked, although the pullback was so precipitous that executing a stop entry would have been challenging.  Some subscribers may also recognize that 'Matt's Curse'  took effect when the reversal occurred precisely at p2. This usually means the retracement will take out the point 'C' low of the pattern. We shall see, but if it happens we shouldn't take it too seriously, since gold has been visiting pain equally on bulls and bears alike for the last several weeks. _______ UPDATE (Oct 13, 4:20 p.m.): And speaking of pointless histrionics, you had to love gold's $40 lunatic leap today after spasming $20 both ways in the early going. A short a millimeter off the intraday high produced a profit for the subscriber who reported the trade in the chat room, but the pullback made little progress as the hours went on, suggestion that bullion's 'DaBoyz' aim to take this gas-case higher. Here's a pattern so gnarly that I can all but guarantee that it will work in every possible way, including shorting at 1810.50 via a 'camouflage' set-up. That means you could buy a pullback to p=1780.20 'mechanically' with a stop-loss at 1770.10. That's $4000 of entry risk on four full-size contracts, so minis are recommended unless you are trading with winnings racked up earlier. ______ UPDATE (Oct 15, 7:29 a.m.): When the little p.o.s. plunged overnight to within 70 cents of my 1780.20 bottom-fishing number, I used this rABC pattern to drastically cut the entry risk to $480 on four contracts. The trade

Last week produced an exceptional one-day rally, then a sideways follow-through that looks like a bullish consolidation. The start of something big?  Probably not, but we should take the possibility seriously, since, if stocks have entered a bear market, that would be the kind of paradigm shift that could change a picture in bullion that has remained stagnant for a year. I've displayed a weekly chart to put the rally in perspective: it is not even a blip, at least not yet. Nor should we get too excited if a fresh burst hits the green line, triggering a theoretical buy signal of long-term degree. That's happened twice since last summer, only to fail with the creation of two new point 'C' lows. This time price action so far is arguably less bullish, since the reaction rally off mid-August's stop-'em-out low didn't even reach the green line, nor was it impulsive on the weekly chart. I can offer no trading suggestions at the moment, but if you are scouting the lesser charts for opportunities, please don't hesitate to ask about them in the chat room. _____ UPDATE (Oct 4, 5:10 p.m. ET): If bears can chew through p=1770 tonight they'll be in good shape for a follow-through to the 1792.40 target of this pattern.  Using 'camouflage' to avoid $1100 of entry risk per contract, buy a pullback to the green line 'mechanically' if the opportunity should arise, especially in the wee hours.  _______ UPDATE (Oct 5, 6:53 a.m.): The trade triggered at 12:39 a.m., 14 minutes after the futures pulled back to the green line (1758.90). The set-up, shown here on the one-minute chart, produced a gain on four contracts of as much as $480 in 40 minutes before gold peaked shortly thereafter and dove. Initial, theoretical risk would have been

The decisive breach of p=1755.30 last Thursday strongly implies a finishing stroke to at least D=1722.2o in the days ahead. As always, if that Hidden Pivot support is easily exceeded, the downside target of a bigger pattern would be in play. Meanwhile, the futures triggered a 'mechanical' short from the red line that in theory is still 'live,' since the downtrend has yet to touch p2 following the signal. However, if they were to rally to x=1771.90, that would activate a second signal to get short. The stop-loss would risk nearly $7000 on four lots, but I'd suggest cutting it down to size with a 'camouflage' trigger on the lesser charts. If you're uncertain about how to do this, ask in the chat room when the trade gets close. _______ UPDATE (Sep 29, 9:40 p.m.):  We used the 1722.20 target to get long near the low, which occurred at 1721.20. The bounce has produced a profit of as much as $2500 on four lots so far. Check my Trading Room posts beginning at 10:33 a.m. for details. _______ UPDATE (Sep 30, 6:49 p.m.): Usually a sharp rally in gold is barely worth a yawn, but I'm keeping an open mind this time. That's because the same distinctive tone change that may already have caused stocks to top big-time may correspondingly launch the resumption of a bull market in bullion that we've patiently awaited for more than a year.

Gold has looked so awful lately that I've gone against my gut in drawing the mildly bullish chart shown in the inset. It is a slightly 'reversed" ABC pattern, with a point 'C' just a hair beneath late March's 1683.00 low. The pattern projects to 1916.20, which would represent a 7% gain from Friday's settlement price.  A 'mechanical' buying opportunity on a pullback to x=1737.50 is strongly implied, and so that is what I will suggest, at least for now. The trade would take a stop-loss at 1677 , implying about $24,000 of initial risk on four contracts. Since that is way out of our league, we'll use a 'camouflage' set-up if and when the opportunity arrives. Our goal would be to cut the theoretical entry risk by about 85%, to around $3600. _______ UPDATE (Sep 16, 9:04): Gold is garbage once again, diving hellishly just to mau-mau bulls. Since sellers look like they're about to pulverize the green line, I'll suggest backing away from the rABC set-up suggested above. the trade would still enjoy good odds, but at a cost of possibly excruciating pain.  Ace Pivoteers can attempt the trade nonetheless with a camouflage set-up pegged to a low near 1700, the sweet spot of the downtrend's discomfort zone. _______ UPDATE (Sep 21, 11:47 p.m.): So far, a bullish prediction made by 'Som' in the chat room is holding up. He called for an upturn after Sep 17, and that is in fact what has occurred. I am skeptical about how far the rally can go, but not so skeptical that I would forego an opportunity to make hay with it, trading with an aggressively bullish bias until weakness becomes evident. In the meantime I'll gladly vet any entry strategies broached in the chat room, so don't hesitate to

Gold ground tediously higher last week, using a five-day consolidation at p=1816 to launch a relatively measly $18 rally on Friday.  We'll continue to use the 1850.60 target shown (a slight adjustment from earlier) as a minimum upside projection, but don't look for the uptrend to blow it away, given the week-long dirge at the midpoint pivot. If gold shocks by doing  just that, you can use the 1916.20 target of this bigger, rABC pattern to inform your trades. Since it is a reverse-bullish pattern, with 'C' below 'A', it should work nicely for 'mechanical' setups. ______ UPDATE (Sep 8, 8:01 a.m.):  Far from shocking us with a strong follow-through rally, gold plummeted, as it so often does, for no good reason. Let's avert our eyes for the time being, lest we start to believe this frustrating price-action actually means something.

I've grown so skeptical of gold's rallies that I didn't even mention the textbook 'mechanical' buy the December contract triggered last week on the pullback to the green line. It was worth $5,000 to anyone who bought there, and more power to you if you did without waiting for me to confirm. Since the pattern has worked so nicely for bulls, let's use D=1829.60 as a minimum upside objective. If that Hidden Pivot is decisively exceeded, the new target would be 1851.50, calculated by shifting B-C up a rung. Either target is worth shorting if you've made money on the way up, but I'd risk no more than $80 per contract with a 'camouflage' set-up or rABC.

Gold's rally flattened dismally last week, but it was never going to get very far to begin with. A glance at the chart shows the relentless weight of the downtrend, punctuated the entire way by pyrite rallies. This one would become an enticing short via an rABC set-up if it gets to around 1885.00. That's right in the 'discomfort' groove, although we shouldn't get our hopes too high that it will be reached. If the futures instead roll down this week after failing to surpass last weeks high at 1797.60, look to go long against the trend near 1718.60 with as tight a stop-loss as you can abide. _______ UPDATE (Aug 23, 11:02 p.m.): The new 'C' high at (so far) 1809.10 has raised our bottom-fishing bid to 1730.10. It will likely change, so here's a chart to allow you to adjust it on-the-fly. If the futures rally above July's peaks, you can cancel the bid at the red line.

Gold spent last week turning the previous week's plunge into potentially gratuitous mau-mauing of bears by the nefarious forces that control bullion's price action. We'll take a cautious stance, since the rally has occurred off a quite-impulsive down-leg that is shown in the chart. For your peace of mind, I'd suggest being not quite as enthused about the rally as we were frightened by the still-pungent plunge. For the time being, use the pattern shown to avoid getting fooled.  If the point 'C' high eventually migrates above the August 4 'externall' peak at 1835.90, I could warm somewhat to gold's intermediate-term prospects. As always, you should tune to the chat room and your email alerts if you want to stay apprised of timely intraday opportunities.

Strong employment numbers and the higher interest rates this supposedly will bring drove gold sharply lower on Friday, according to the usual experts. What rubbish! Gold dropped simply because it was time for it to drop. It's not as though the market actually divines the future and discounts it in a rational way. If investors possessed even a mote of rationality, gold would be trading above $2000, discounting the biggest monetary blowout in history.  Instead, bullion looks poised to drop even further, since the bounce from an opportune midpoint Hidden Pivot support at 1763.30 was so weak that it's hardly visible on the hourly chart. (That didn't stop us from making money with some very precise bottom-fishing. Check out my 10:48 post in the chat room to see how.)  For now, we'll use p2=1722.40 as a minimum downside target and 1683.50 as worst case for the next 2-3 weeks. This is jumping the gun, since I ordinarily wouldn't project another leg down until the midpoint pivot has been decisively breached. In this case, however, I'll give bears the benefit of the doubt, since they seemed so feisty on Friday. We can use the chart shown in the usual ways, to get long or short as opportunities arise, so stay tuned to the trading Room if you care! _______ UPDATE (Aug 8, 10:53 p.m.):  The 1683.50 target nailed the low of an $85 death dive within three-tenths of one percent.  Virtually any strategy you might have used to get long at the low -- or short ahead of the spectacular, gratuitous swoon -- would have produced a large profit with almost no pain.  Maximum gain on the short position from the time the tout went out would have been a little more than $34,000 on four lots; the so-far bounce could