Gold

Elsewhere on this page, I've explained why the memorably nasty selloff in silver is unlikely to prove fatal. My reasons are technical, based on a recent rally spike that exceeded an 'external' peak recorded seven years ago.  Price action in gold corroborates this with evidence that is not so esoteric. Specifically, last week's spike to record highs exceeded a clear target on the weekly chart at 2031.30. Although there were other, higher targets that went unfulfilled, the December contract's upside penetration of a Hidden Pivot resistance we can be certain of is indisputably bullish. The correction likely has farther to go, however, and we shouldn't be surprised if it probes round-number support at 1800, or even 1700, before sellers are exhausted in perhaps 6-10 days. _______ UPDATE (Aug 13, 8:59 p.m. ET): The futures have been struggling for loft, but we can still use p=2008.90 shown in this chart as a minimum upside target for the near term. As always, a  decisive push past a midpoint resistance, especially on first contact, would shorten the odds of a finishing stroke to D=2143.50.

The December contract, so light and frolicsome recently, turned leaden on Friday with the futures about $17 below a promising looking rally target at 2107.10. We can focus on the lesser charts to tell us whether the weakness is likely to develop into something serious. As things stand, the bounce from the intraday low at 2024.80 triggered a 'mechanical' short at 2040.50, stop 2051.10. I didn't mention this in the chat room, however, because it was late in the day and because the buying looked pretty spirited. Now, a print exceeding c=2051.00 on Sunday night would stop out the theoretical short -- exactly what we should want to happen if we are going to continue to trade with a bullish bias.  The 2107.10 target will remain viable in theory unless 1927.50 is breached to the downside, but as a practical matter it would start to dim below 2000. _______ UPDATE (Aug 10, 9:04 p.m. ET): Night owls can try bottom-fishing at the 2010.60 target shown in this chart.  An rABC pattern where a= 2027.80 on the hourly chart (8/10, 3:00 p.m. ET),  is the best way to keep entry risk under tight control, but if you are unfamiliar with the tactic, use a simple, 2010.10 stop-loss. The futures looked sickly in after-hours trading, so plan on taking at least a partial profit if the trade goes your way modestly. _______ UPDATE (Aug 11, 8:48 a.m.): Gold got hit hard overnight with selling that is continuing this morning. The December contract looks bound for 1954.60, a Hidden Pivot target shown in this chart, but if it gives way, the slide could continue to as low as 1937.40 (b=1991.40).

[This went out via email at 6:01 p.m. Wednesday night with December Gold trading $20 lower. Owing to a problem with WordPress, however, it did not get published in the list of touts at that time. RA] I've swapped out the October chart for December, since that's where the action is.  The 2107.10 target is $16 higher than the old one, but the implications are the same. Given the steepness of the impulse leg that unfolded during the last two weeks of July, a pullback to p=2017.60 would set up an enticing 'mechanical' buy, stop 1987.70. Since Mr. Market is unlikely to gift us with such a juicy opportunity, we'll need to pay close attention to smaller entry patterns at these  levels, particularly rABCs on charts of 15-minute degree or less.  There is one such set-up at the rightmost edge of the chart shown, with an 'A' low at 2044.40 (9:00 a.m.). Entry would have come at 2046.40, stop 2941.80. ______ UPDATE (Aug 7, 8:34 a.m. ET): The futures have turned heavy, their progress toward the 2107.10 target stymied Thursday evening at 2089. I am no longer recommending a straight 'mechanical' buy on a pullback to 2017.60, since the 'D' target was nearly achieved. However, because it remains valid in theory, we still have a bull trade ahead of us, presumably with risk under tighter control than a 'mechanical' entry would allow.

The futures appear to be basing for another rally, although they cannot yet be considered an odds-on bet to achieve the 2285.90 target shown in the chart.  A move at least somewhat higher over the near term seems likely, however, given the way last week's sharp thrust exceeded the 1981.60 target shown here.  The small overshoot may not look significant, but in the visual context of an ABC pattern so clear and compelling, that's sufficient to warrant a bullish trading bias. The upbeat picture would change, however, on a pullback early in the week exceeding the 1941.70 low recorded on Thursday. Otherwise, look for buyers to cruise above 2000 -- for the first time ever -- soon. _______ UPDATE (Aug 4, 7:06 p.m.): The move above $2000 has been so effortless that the futures should be presumed headed to p2=2046.30, at least, arriving either today or early Thursday. As always, a decisive stab through a Hidden Pivot level would imply a move to the next -- in this case the 2091.00 target of the pattern shown in this chart.  A surprise swoon to the green line would trigger a mechanical buy, stop 1912.10. _______ UPDATE (Aug 5 8:34 a.m.): The futures have pulled back a mild $7 after topping at dawn at 2048.00, a hair above the 2046.30 pivot I'd proffered as a minimum upside target. Once this correction has run its course, a decisive pop past p2=2046.30 would all but lock up more upside to the 2091.00 Hidden Pivot noted (and shown in the chart) above.

August Gold's leap Monday night missed a longstanding target at 1992.40 by $18, which ordinarily would warrant a cautious stance for at least a few days. In this case, however, the recovery following an overnight sell-off has been so quick and effortless that a lasting push above $2000 seems all but assured. The modest, 2006.20 target shown in the chart is one of several I could have displayed, but it will suffice for now as a minimum upside objective.  I'll haul out some bigger charts with more  ambitious targets once gold looks like it has found solid footing above $2000. ______ UPDATE (Jul 30, 2:35 p.m. ET): Today's snoozefest did not alter the bullish picture for the near-to-intermediate term.

Careful! August Gold is closing on a potential rally stopper at 1877.40. I expect a push above it, perhaps  after a brief stall, but if buyers blow past it Wednesday night or early Thursday, they'd be in good shape for a romp to the 1992.40 target shown in this chart. I have adjusted it slightly downward from the 1994.40 given here earlier because one of the original coordinates was wrong. The precise pullback from p=1830.40 in the second chart suggests that when the 1992.40 Hidden Pivot is reached, it'll be a good opportunity to lighten up. As far as I can tell from the discussion in the chat room, all subscribers who trade gold have been long with confidence and are enjoying the ride. ______ UPDATE (July 23, 5:35 pm.): Bulls are closing on p2=1911.40, a secondary pivot associated with the 1992.40 target shown in the chart linked above. It is all but guaranteed to be reached, but be prepared for a stall and the start of a correction lasting for as long as a week or two.  Alternatively, if the futures blow past the pivot, closing above it for two consecutive days, that would imply 1992.40 has become and odds-on bet to be reached and that this will happen sooner rather than later. _______ UPDATE (Jul 27, 7:14 p.m.): The cruise to an almost certain  rendezvous with 1992.40 has been effortless if unspectacular. This Hidden Pivot should evince tradeable stopping power, although I don't intend for you to get short there. The round number $2000 is the  more formidable obstacle, but there is nothing in the technical picture to suggest an important top will occur at that height. _______ UPDATE (Jul 28, 7:07 a.m.): Tricky, vicious and gratuitously nasty as always, gold topped overnight at $1974 -- just $18,

The 1838.10 target we used last week to stay on the right side of a challenging uptrend still looks like a good bet to be reached. Even certitude about this is no license to use a buy-and-hold strategy, since the risk/reward ratio stinks most of the time. The best way to get onboard when trading a vehicle that is as crazy-stupid and nasty as this one is with a mechanical bid. I flagged one last week at 1802, but with a warning that the the entry risk on four contracts was nearly $4000. As it happened, the position went $3200 in the hole on Thursday before the futures pulled out of a tailspin and reversed course sharply on Friday. At the close this gambit was showing a paper gain of around $3600 -- proof again that mechanical trades work well if they are predicated on textbook impulse legs. Subscribers unfamiliar with the tactic should paper-trade 'mechanicals' whenever I tout them to build confidence. ______ UPDATE (Jul 20, 9:06 p.m.): The 1838.10 target given above looks like a lock-up at this point, but here's a bigger-picture target at 1994.40 to wrap your head around. This is the first time I've mentioned it, and although I can't offer any guarantees, it would become an odd-on bet to be reached following a decisive push past p=1833.10 or a two-day close above that midpoint Hidden Pivot. _______ UPDATE (Jul 21, 8:36 a.m.): It is most encouraging that buyers have blown past 1833.10 this morning with a spike to 1843.20. Usually Comex futures give up most such gains achieved at this time of day, but perhaps not.  In any event, the rally certainly hasn't hurt bulls' chances of seeing 1994.40, perhaps soon. If this is the beginning of a powerful bull phase, it should happen within

Wacky price action can be leveraged using mechanical entries based on the pattern show in the chart. Wednesday's low missed filling a bid at the green line, but if the futures return there it would still be a decent bet, stop 1791.00.  The implied entry risk is more than $4000 on four contracts, so we'll want to cut it down to size using the lesser charts 'camouflage'-style if the opportunity arises. The 1875.20 target of a larger pattern remains viable, but we're taking it one step at a time since gold has shown no signs of becoming a friendly buy-and-hold. More like Chinese water-torture, actually. _______  UPDATE (July 16, 8:50 p.m. EDT):  Gold was more than mildly disappointing today, although its mini-plunge failed to stop out the mechanical bid I'd noted above. With no drama indicated on the chart, I'll suggest watching from the sidelines for now. I'll be curious myself to see whether the trade works.  The tactic is geared to exploiting violent swings, not the kind of gratuitous, sloppy meandering we've become used to in gold.

Gold's bullish slog has been tortuous, even if there has never been much doubt about where it's headed. The chart shows an 1875.20 target for the August contract that we've used to stay on the right side of the market and to keep the many setbacks along the way in perspective. A pullback to the red line at 1771.80 would set up a tempting 'mechanical' buying opportunity, but we shouldn't expect the market to oblige just because we've proven our patience. We'll continue to scalp off the Hidden Pivot levels with timely posts in the chat room, but  getting a piece of the final thrust to D won't be easy because gold is finally attracting its fair share of bulls. _______ UPDATE (Jul 14, 8:42 p.m. EDT): The pattern shown in this chart, with a target at 1825.90, can be used to get aboard as the futures slowly make their way toward the more ambitious target flagged above.  The A-B impulse leg is not exactly a killer, but it looks strong enough to favor mechanical entries on pullbacks to any of the three Hidden Pivot levels: p, p2 or D. Stay tuned to the chat room for timely ideas.