Gold

Gold ripped bulls a new orifice today, crashing a midpoint Hidden Pivot support at 1192.50 and greasing the skids to the 1140.30 target shown (see inset). The breach of the midpoint was sufficiently blunt that we can infer further slippage to at least 1140.30 is very likely. The December futures will have a chance to bounce from the 'secondary pivot' at 1166.40, but I wouldn't count too heavily on it. A rally back up to the green line (1218.60) would signal a mechanical short, stop 1244.80. ______ UPDATE (August 16, 9:10 a.m. EDT): The futures have bounced from 1167.10, less than a dollar from the secondary pivot noted above, after being down more than $17 overnight. The yellow flag is still out, and the 1140.30 target will remain valid in theory until such time as 1244.70 is exceeded to the upside.

Although there's still no compelling technical evidence that gold is headed below $1000, there would appear to be little chance that the December futures will not full a further $14 to the 1187.70 target shown (see inset). Traders looking to scalp a promising low can bid there (or slightly higher), stop 1186.90, but don't pass up an opportunity to take a partial profit on a rally of as little as $3-$4. Also, beware of the sleaze factor, since a subscriber  reported being unable to fill a 1202.90 bid Monday morning -- that had been my minimum downside target for the last several weeks -- even though the futures initially traded down to 1202.00 (and rallied $9 before relapsing).

Shifting to the October contract yields a compelling downside target at 1197.7o that can replace a projected range of 1192.70-1201.10 given here earlier for the August futures. Basis the December contract, this is equivalent to 1202.90.  As always, I'll recommend bottom-fishing this Hidden Pivot support aggressively only to subscribers who have made money being short on the way down. A rebound in the meantime to p=1240.60 (basis the December) would set up an enticing if belated 'mechanical' short. We'd want to execute it via a 'camouflage' set-up to significantly reduce the initial, theoretical risk of nearly $1200 per contract. ______ UPDATE (August 7, 1:22 p.m. EDT): So we're not caught unawares if enthusiastic buyers show up unexpectedly, I've set a chart alert at 1237.90, since a print there would turn the hourly chart impulsively bullish.

I disseminated a bearish target at 1192.70 last week, but August Gold will have an opportunity to turn from a lesser Hidden Pivot support at 1201.10 if the downtrend continues. The target is shown in the chart.  As you can see, its 1218.20 'midpoint support' has yet to be penetrated decisively; moreover, the downtrend has stalled twice exactly at the support. This means that although the target itself is not yet in play, it would become our precise objective if and when the midpoint is breached by more than $2.50 or so. Alternatively, we should want to see a pop above July 17's 1245.10 peak before we lower our guard even slightly.

Like September Silver, August Gold relapsed today after failing to reach a minor rally target that should have been a lay-up. However, for technical reasons I won't go into right now, the net result is not quite as threatening. It at least allows me to offer a bullish scenario, albeit one that will require gold to leap strongly before I wax enthusiastic again. Specifically, I'll stipulate that the futures must thrust above the 1245.10 peak labeled in the chart (see inset). Otherwise we'll have to assume that the downtrend is likely to continue to at least D=1192.70, a Hidden Pivot destination that has been six weeks in coming.

The August futures set up such an appealing buying opportunity for bulls Monday that several subscribers jumped on it when a timely 'mechanical' entry strategy was posted in the chat room. Alas, anyone who got long toward the end of the day watched the trade sink precipitously overnight, stopping out the position for a loss of around $600 per contract. As a rule, when a juicy Hidden Pivot trade set-up flops so miserably, it can pay to quickly reverse the position and do the opposite. In this case, however, going short seems no more appealing than going long, since bullion has been treating bears almost as badly as bulls. 'Too Much Hopefulness' My gut feeling is that the seemingly perfect 'mechanical' entry failed because there are still too many hopeful bulls out there. It would appear that they view each and every $20 rally as the first stage of a move to $2000, and that's why gold has acted so leaden.  Disrupting this familiar pattern and setting the stage for a sustained rally will likely require one last, brutal shakeout. That would logically imply a dive below the key low at 1230.70 recorded almost exactly a year ago.  If and when this happens, tune to the chat room for a possible 'counterintuitive' entry plan. In the meantime, I plan to ratchet up my skepticism and tune out the "Any-day-now!" bullishness of some of my guru colleagues. I'll let the charts speak for themselves. This might have saved us some pain, since I green-lighted Monday's trade even though gold had yet to exceed a 1274.40 benchmark flagged in my last update. For now, I will raise the bar to  1286.90. A rally over the next 2-3 days that hits that price would not likely be a fake. _______ UPDATE (July 17,

The futures have moved very predictably lately, tracing out new lows that have bounced at or very near minor Hidden Pivot supports. I'd projected such a reversal from the 1246.40 target shown, and it came on Friday as expected. The actual low was 1246.90 -- four ticks above the 1246.50 bid, stop 1245.90, that I'd advised in the chat room (see my 13:45 post on 6/28).  Since no one reported using this target to get long, I have not established a tracking position.  My next target lies at 1235.90, a middling 'hidden' support that should generate a bounce as precise as the ones that have preceded it. This is my minimum downside projection for the near term, and your trading bias should therefore remain bearish until such time as it is reached.  It would take an upthrust to 1274.50 this week to suggest buyers might be emerging from their coma. ______ UPDATE (July 2, 5:05 p.m.): Exuberant as an infant's funeral, August Gold is closing on my 1235.90 target more quickly than I might have imagined. We should pay close attention -- and bottom-fish with a very tight stop-loss -- when it gets there, if only because the idea of getting long in gold is enough to induce nausea in some investors. There is not quite blood running in the streets, but there are enough rivulets to suggest it's time to give our contrarian instincts free rein.______UPDATE (July 4, 9:12 a.m.): We'll take Tuesday's impulsive rally seriously, based on the contrarian logic stated above. It is vexatious that the futures missed hitting our bid by just $3, but it is also incipiently bullish that this occurred -- the moreso if the rally continues to exceed prior peaks. It has done so twice on the hourly chart over the last two

Gold's breach of the 1267.40 target we've been using as a minimum downside objective has brought the prospect of yet more misery into focus. Specifically, I am now suggesting that you use the 1235.90 Hidden Pivot shown as a minimum downside objective for August Gold. I particularly like this 'hidden' support because the pattern itself is so gnarly. We've learned over time that such patterns are the ones that work best, since their provenance is so obscure -- even to those used to seeing so-called Gartley 1-2-3 patterns. Traders should note that a rally to the green line would trigger a 'mechanical' short in theory; otherwise we should expect to see the August futures make their way to 1235.90, at least. As always, an easy breach of so compelling a target would portend even lower prices. I still doubt that gold will fall below $1,000, although that will be scant comfort to bulls who have experienced the acute disappointment of the last two months. _______ UPDATE (June 26, 6;57 p.m. EDT): The 1235.90 target remains not just valid, but compelling. However, the 1253.80 target of the lesser pattern shown in this chart also looks capable of generating a bounce, possibly a tradeable one. _______ UPDATE (June 27, 12:29 p.m.): The futures have reversed sharply, rallying $3.60 so far from within 50 cents of the 1253.80 target flagged above. If two or more subscribers used it to bottom-fish, I will provide tracking guidance, so please let me know in the chat room. You should take a partial profit now if you bought more than one contract.  _______ UPDATE (June 27, 9:51 p.m.): Chat-roomers reported doing some profitable bottom-fishing by playing the 1253.80 target for a bounce, but I haven't established a tracking position because this brick subsequently slipped below the support.

Is gold headed below $1000?  I doubt it. Like every other bullion investor who has tired of watching gold's price meander sideways for nearly six years, I've grown increasingly disappointed and frustrated. But also concerned, as many apparently are, that one last, hellish plunge may be necessary to shake out the weak hands. However, looking at the long-term chart, I'm persuaded that bulls still have the edge, if not a big one. That's because the 'impulsive' leap gold took between October 2008 and August 2011 was so powerful, pushing the price of an ounce from $680 to $1912. Although the subsequent retracement took 70% of it back with the $1046 low that occurred in December 2015, bears have been challenged ever since to win the skirmishes that prefigure changes in the long-term trend. By my analysis, gold 'should have' fallen to $821 at its correction low.  It could still get there, and that target will remain valid in any event until such time as 1432.50 is exceeded to the upside. But there is nothing in the chart that implies bulls are going to give up that much ground. To the contrary, they took a shot across bears' bow with a $328 thrust in 2016 that tripped a theoretical long-term 'buy' signal at the green line (see inset).  The move exceeded no fewer than four 'external' peaks on the daily chart, and that's why the bad guys have struggled so hard to push gold back down. They may be able to crush the spirit of bulls, and to do so repeatedly. But this is not the same as crushing prior lows that continue to provide 'structural' and psychological support on the long-term charts. Set an Alert at 1208 If you want a warning signal that the tide could be turning in bears'