Gold

February Gold has now climbed nearly $50 since turning on December 12 from within an inch of a 1237.40 correction target I'd flagged well in advance. The futures were trading a few points below 1290 on Tuesday, but they will need to leap past 1321.00 to imply that buyers are serious. That would generate a bullish impulse leg on the DAILY chart. It would also exceed the 1314.00 midpoint resistance of a pattern projecting as high as 1389.60 (click on inset to see this). That target is fanciful at this point, but odds of its being reached would shorten with a decisive penetration of p=1314.00 or a two-day close above it. _______ UPDATE (Jan 1, 8:42 p.m. EST): February Gold has not achieved even the lower of the two bullish benchmarks flagged above.  (Click here for new chart.) However, last week's strong, steady rally is reason to take encouragement. Let's see what another day or two brings.

Feb Gold's feeble rally achieved more than it may have seemed, narrowly exceeding an important 'external' peak at 1271.80 recorded December 6 on the way down. This refreshed the bullish impulsiveness of the hourly chart, creating a possible 'camouflage' entry opportunity in the process. I've sketched it hypothetically in the accompanying chart (click on inset) and would encourage any night owl who understands the opportunity this set-up would create to exploit it with a 'conventional' entry at 'x'. At press time, the tentative point 'C' low was 1269.90, implying a long entry would trigger at 1270.60. If the futures ease lower, particularly if this generates a new point 'C' low falling within 0.50 or so of A= 1266.00 (1221.00 at 9:00 a.m.), you can fashion a 'counterintuitive' entry trigger. _______ UPDATE (Dec 22, 9:25 a.m.): The trade triggered at 1270.00 (1:00 a.m.) and is targeted on a minimum 1274.90. As always, we should want to see a pop through a Hidden Pivot resistance if we're going to continue to give bulls the benefit of the doubt. The next important resistance,  from a 12/4 peak, lies at 1280.50, and a move past it would be most encouraging.

With today's thrust, February Gold has extended its rally from 1238.30, a bottom recorded on Monday that could prove to be important. It occurred less than a dollar from a target we'd used that had been three months in coming. A bounce lasting another 3-4 days would be appropriate if the larger downtrend is fated to resume. In any case, the rally would need to surpass the 1321.00 peak labeled in the chart to demonstrate real staying power. The futures should be traded with a bullish bias in the meantime. I haven't established a tracking position because getting long at the low required bidding a few ticks above where I'd suggested. Subscribers who traded my guidance aggressively and got long nonetheless have enough of a cushion by now to relax and do as they please. The so-far high of the move is 1259.70, representing a $21.40 reversal. _______ UPDATE (Dec 14, 4:36 p.m. EST): Wednesday's mildly promising rally turned flaccid after buyers failed to maintain altitude above the previous Tuesday's high. I've downsized my short-term outlook with a small pattern yielding a 1272.10 target. Critical resistance is at 1262.50, somewhat above today's peak. ______ UPDATE (Dec 17, 9:34 p.m.): Gold head-faked above 1262.50 on Friday, then died. Consider this trading vehicle worthy of our attention only if it pops above 1271.80 or falls below 1242.30. The 1272.10 target given above remains valid. _______ UPDATE (Dec 20, 6:01 p.m.): No change in my guidance. Although today's high at 1271.40 came very close, it did not satisfy my requirement.

Gold's long dirge has had a 1237.40 Hidden Pivot support as its no-brainer target since mid-October. In the interim, the only useful advice I've been able to give you was to treat each rally as a cruel tease. Now, with the February contract closing on our number, it's okay to become slightly interested, since there may be a bottom-fishing opportunity. Specifically, I'll recommend bidding 1237.40 for a single contract, stop 1235.90. Ordinarily I would suggest doing four contracts, and you can certainly do so if you know how to reduce theoretical entry risk to 0.50 or less per contract with a 'camouflage' entry set-up. But in this case the falling piano we would attempt to catch has been falling for so long that I can only recommend a single-contract bid against the trend. If the order fills and goes more than $4.50 in-the-black, check back here for updated guidance. Otherwise, take your loss with firm confidence that there will always be another opportunity. ______ UPDATE (Dec 12, 2:16 p.m.): The futures bottomed this morning at 1238.30, scant millimeters from my longstanding target. For explicit instructions, please refer to my posts in the chat room around 13:17. The gist of it is that if you did not buy on gold's first approach to the target, you should not do so now. _______ UPDATE (7:18 p.m.): The futures have rallied $7 from the 1238.30 low. I am not establishing a tracking position because  only one subscriber reported getting long with a bid placed just above the downside target. Whatever the case, anyone long from near the low has built enough cushion into the trade that it will be hard to lose.

Bulls' failure this week to achieve the 1305.00 Hidden Pivot target shown in the chart (click on inset) is not exactly a sign of robust health. Actually, the good guys needed to have done somewhat better than that, surpassing the 1312.70 peak from October 16, to show their seriousness. Instead, they died well shy of it; and, to make matters worse, relapsed on Wednesday to a new weekly low. The technical damage would begin to look serious if sellers push the February contract beneath 1278.50, the point 'C' low of the 1305.00 rally pattern. We've learned by now -- all too well -- that gold's corrections are designed to bring bulls to the threshold of despair. By my lights, that would require a dip beneath mid-October's 1267.00 low. We'd be feeling bullion's pain by then, presumably just ahead of the next not-quite-satisfying rally. _______ UPDATE (Nov 30, 5:59 p.m.): Gold mildly tanked today as expected. Now, if the futures cannot hold support at p2=1272.70, the February contract will be bound for at least 1258.70. Click here to see it in a chart. You can bottom-fish there with as tight as stop-loss as you can abide.  _______ UPDATE (Dec 7, 9:30 a.m.):  The so-far small breach of the 1258.70 target means gold is headed even lower -- presumably to 1237.40. Click here to see the chart. If you bottom-fished per my instruction, please report it in the chat room so that I can score the loss. _______ UPDATE (Dec 10, 5:30 p.m.): You can bottom-fish the 1237.40 target with a 1237.60 bid, stop 1236.50. I'm suggesting only a single contract for this trade, since we are after all attempting to catch a falling piano.

December Gold did something on Friday that it hasn't done in a long while, exceeding two Hidden Pivot targets on the hourly chart without correcting.  One was minor, the other middling, but the implication is that the uptrend is a good bet to continue into next week. Moreover, the exhaustion of targets on the hourly chart will require us to shift to a bullish pattern of larger degree. It is shown in the chart (click on inset), with a 1315.50 midpoint pivot that can be used as a minimum upside projection for the near term. As always, an easy and decisive move past this key threshold would put the 'D' target -- in this case, 1368.10 -- solidly in play. _______ UPDATE (Nov 20, 12:33 p.m.): Today's gratuitously nasty drubbing has changed nothing in the analysis above.  If the weakness continues, however, touching 1269.80, that would turn the short-term picture mildly bearish._______ UPDATE (Nov 21, noon EST): Zzzzzzzzzzzzz. _______ UPDATE (Nov 28, 11:16 p.m.): Use 1307.20 for a target on the Feb 2018 contract (20-minute, A=1275.20 on 11/14), since that is where it's going. As always, a small overshoot -- in this case as little as four ticks -- would imply bulls have seized the advantage.

A Bloomberg headline on Friday averred that gold had "plunged" due to the "mysterious" sale of four million ounces. The reality was somewhat different, as the chart shows. Gold dove, to be sure, but not very far in relation to price action over the last couple of months. Concerning the mysterious seller, we're probably better off not knowing, since the hacks who report the news would probably find a way to trace the trade back to Trump, or to the Swiss central bank. Or your grandma.  And then where would we be?  Anyway, the chart says as much as we need to know right now -- i.e., that bulls and bears have been locked in a duel, trying to kill each other with rubber-tipped scissors. The 1254.10 downside target we've been using for weeks remains viable in the meantime, but we can put it aside if the futures rally to touch 1293.00. _______ UPDATE (Nov 15, 12:26 p.m.): Today's gratuitously nasty head-fake actually created a picture-perfect impulse leg on the hourly chart, so bulls needn't quite despair. Let's see if they can leverage this set-up for all it's worth -- namely, a pop to the 1295.80 target. _______ UPDATE (Nov 16, 5:15 p.m.): Thursday's sloppy histrionics slightly lowered the target, to 1294.20. A push past p=1284.60 would be a downpayment on it.

The futures did all we'd asked of them Wednesday, pushing above a prior peak on the daily chart at 1286.20. Somehow, I still don't trust the rally, so we'll take a conservative approach to getting long. Specifically, I'll suggest using a 'mechanical' trigger at 1300.60 (i.e., the green line) if and when it is exceeded and then touched on a pullback meeting our simple criteria for this type of trade. I am suggesting a 'trigger' here because we can use it to get long via another tactic, 'camouflage', which has the potential to lower the $3800-per-contract entry risk to more like $60-$120 theoretical.  The trade will take at least 4-6 days to set up properly, so there's no rush.

The 1254.10 downside target we've been using to stay steadfastly on the right side of the trend remains viable and should be used as a minimum downside projection for now. Unfortunately for bulls, when December Gold peaked last week at 1285.10, it just missed surpassing an 'external' peak on the daily chart recorded nine days earlier. This would have generated a mildly bullish impulse leg. Alas, it was not to be, and the clear implication is that downtrend will continue. Because of gold's recalcitrant behavior, we should also raise the bar somewhat for turning bullish -- to 1293.00, a tick above an external peak recorded Oct 20 on the way down. If the futures instead fall to the target, you can bottom-fish there with a bid at 1254.20, stop 1253.80. _______ UPDATE (Nov 7, 6:01 p.m.): A prior peak at 1286.20 is the lowest and most immediate benchmark I can suggest for determining whether bulls are serious. Click here for the chart to see this moderately important hurdle in perspective.