Gold

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'

 I've been saying for quite some time now that gold is not yet ready to take off. There are still too many gold bugs clinging on for hope after all these years and not until the last one has thrown the towel in will this gold bull market resume. What will make the last gold bug throw the towel in? Imagine the media generated hysteria if gold were to breach the psychological sub-$1000 mark. The front page of Time Magazine would declare gold dead. Interestingly this sub $1000 target happens to be neatly sandwiched between two weekly P2's.  I'm guessing if we were lucky enough to get such a move down that it will happen by the end of this year and it will be a back up the truck opportunity.  Only taking out $1434 to the upside would negate this downside target. Either way we are not yet ready for prime time.

There are a bunch of minor, bullish patterns we can use to gauge bulls' spirits here, but I've picked a so-so one to avoid reading the chart too bullishly or bearishly. In the picture shown, the June contract would need to push decisively past p=1355.20, meaning to 1360 or higher intraday; or close for two consecutive days above it, in order to become an odds-on shot to hit D=1374.80. It's been a while since gold futures attained even such a minor target, let alone exceeded one, so we won't presume too much. _______ UPDATE (April 18, 9:59 p.m. EDT): Buyers fell just shy of the 1360 benchmark given above, but the 1359.00 high actually achieved was sufficient to generate a 'mechanical' bid at X=1344.30, stop 1335.40.  Because the initial risk would be $900 per contract, my suggestion is to paper-trade unless you know how to convert the signal to a 'camouflage' set-up.  Stay close to the chat room for real-time guidance on this. _______ UPDATE (April 19, 7:30 p.m.): I'm rarely a buyer of this vehicle, but in this instance you could attempt it with a stop-loss as tight as four ticks:  1344.50 bid, stop 1344.10.  Here's the picture. ________UPDATE (April 20, 11:15 p.m.): The trade was stopped out for a loss of $40/contract. However, this held bearish implications for the subsequent rally to x=1347.00 (the green line) five hours later. A mechanical short there, stop 1349.60, would have produced a gain of as much as $770 per contract later that morning._______ UPDATE (April 22, 12:44 p.m.):  A subscriber took me to task for supposedly spinning a losing trade into a would-be winner.  Longtime subscribers will know that Rick's Picks is a no-spin zone, devoid of shoulda-woulda-coulda trades. I mentioned the short-gold play above -- after-the-fact -- because it was

Gold has been testing our patience for more than two months, consolidating a bullish pattern with the potential to reach 1437.60.  Anything above that Hidden Pivot resistance would be hinting of more upside to as high to 1465.85.  Both numbers are clear and compelling, so an easy move through either would be quite bullish. The lower of the two targets will remain viable as long as the futures don't fall beneath the 1309.30 point 'C' low of the pattern shown.  I can offer no guarantees, but this wouldn't necessarily be the end of the world; it might be just Mr. Market's way of pushing bulls a few steps beyond disappointment and toward despair. In any event, we'll wait for it to happen before we reassess the longer-term picture, which remains bullish. _______ UPDATE (April 2, 7:41 p.m. EDT): Today's rally was robust, so the 1373.50 midpoint resistance shown in the original chart (click on inset) can serve as a minimum upside projection for now.  This is gold, remember, and we've grown used to disappointment, so don't regard the 1373.50 target a lock-up, at least not yet. ______ UPDATE (April 8, 5:30 p.m.)  While we wait for something...anything to happen, let me put things in perspective: For every day of pleasure we get from this vehicle, we've learned that there will likely be a least ten days of boredom and/or pain. It is manifestly NOT in a bull market. Understood? ________ APRIL (11, 1:03 a.m.): Finally, the futures have caught a favorable breeze. Use the 1372.80 target shown as a minimum upside projection for the near term. _______ UPDATE (April 11, 5:28 p.m.):  Yet another failed rally? Today's thrust to 1369.40 came close to the target, but not close enough that we should be even slightly impressed. Remember, it must EXCEED

As promised, I've adjusted my sights upward, now to the 1367.50 midpoint Hidden Pivot of the felicitous pattern shown. It's tempting to put a move to D=1431.40 on our list of likelihoods, but my forecasts will be of greater value to you if I spell out bullish possibilities one easily predictable step at a time. Thus is the 1367.50 pivot a logical benchmark to use for a minimum upside target for the near term. This is particularly so because Friday's surge exceeded two middling peaks: one internal; the other, external.  Although it will be possible to board at any time using camouflage because the big picture has given us a go-ahead to trade with a bullish bias, no big-picture 'mechanical' entry will be possible until such time as April Gold pulls back from within the range p=1367.50 - 1384.00 (or s0). _______ UPDATE (March 27, 9:35 p.m.):  Gold futures got no lift whatsoever when the stock market reversed and began to plummet. This was not merely disappointing, it was dismal.  I cannot say what is ailing gold at the moment, but after today's leaden performance, we can only infer that bullion quotes will fall over the near term.  The pattern shown in this chart does not yet have a point 'C' high, but once one occurs, you can use it to project support levels for the next leg down.