Gold

With a sharp lurch higher, December Gold has broken above the 1301.20 resistance I'd flagged as crucial to the intermediate-to-long-term outlook.  The rally is encouraging, but we should remain cautious for two reasons. For one, the move was catalyzed by news that Kim Jong Un-sane had fired a missile over Japan. As someone pointed out in the Rick's Picks chat room on Tuesday, however, traders who have faded market moves caused by seemingly shocking news have only made money.  Indeed, every geopolitical crisis in memory, including the bombing of Pearl Harbor and the Cuban missile showdown turned out to have been a great opportunity to buy stocks at relative bargain prices.  DaBoyz used these crises and countless others to shake down shares so that they could by more of them at bargain prices. This was clearly the case here. On Sunday evening, index futures plummeted on news of Kim's brazen aggression.  But Wall Street, cynical as ever, treated the short-lived panic as a fire sale. The result was that, by the end of Tuesday's session, traders had reversed a 134-point selloff on the opening to close the Dow up 57 points -- a 190-point reversal. The second reason we should treat gold's 'breakout' cautiously is that it is still well shy of election night's watershed top at 1353.00. Until such time as that high is exceeded, the 1462.70 rally target given here earlier will in my estimation be more theoretical than probable. For now, caveat emptor. _______ UPDATE (Aug 31, 10:36 p..m. EDT): Thursday's stall at 1327.60, a midpoint Hidden Pivot shown in this chart, implies December Gold will hit 1352.90 if and when it pushes decisively past the lower number. In the meantime, a pullback to the green line would be a 'mechanical' buy, stop 1302.20._________ UPDATE (Sep 5,

Gold's tedious shenanigans should not cause us to take our eyes off the little sonofabitch for too long, since we might miss something interesting. Like now, for instance. The December contact has mildly caught fire and is making another run at 1301.20, a very important midpoint Hidden Pivot resistance that has stopped promising rallies three times since April, including one earlier this week. This is a very crucial obstacle, since once decisively above it the December contract would be no worse than an even-odds bet to reach 1462.70. How decisively?  Two consecutive weekly closes above the pivot would do the trick, or alternatively an intraday thrust exceeding 1325.00 or so. The chart (see inset) shows the whole picture, including the 1301.20 midpoint pivot that I have revised slightly upward from an earlier 1300.70. _______ UPDATE (Aug 26):  I won't dignify Friday's freakish spasm by 'analyzing' it, but suffice it to say, it changed nothing in the technical picture given above. _______ UPDATE (Aug 28, 7:26 p.m.): December Gold is streaking higher tonight, goosed by news that Kim Jong Un-sane had lobbed a missile over Japan. The so-far top at 1330.00 has surpassed the benchmark given above by $5, raising the odds that this rally is for real. At the very least, it has put into play the 1382.00 'secondary' pivot of the pattern as a minimum upside target for the near term.

Gold's slight breach of the 1288.00 target shown is encouraging, but the bullishness of this is merely, well, slight.  The overshoot is not sufficient for us to infer that a glorious rally lies just ahead, but if and when the next upthrust comes, look for it to hit 1300.70, an important midpoint resistance (daily chart, A=1074.10 on 12/30/15). It would take more than that, however -- specifically, a print exceeding 1307.00 -- to refresh the bullish energy of the daily chart; and still more -- i.e., a push above the election night high, 1353.00 -- to put gold back on the warpath. ________ UPDATE (Aug 10, 6:56 p.m. EDT): The futures ended the day slightly shy of the very important Hidden Pivot resistance at 1300.70 noted above (click  here for chart).  A decisive push past it, or two consecutive weekly closes above it, would put a 1461.60 rally target well in play. Buyers have failed twice this year to blast through 1300.70 in April and June. Let's see if the third try proves to be the charm. ________ UPDATE (Aug 13, 6:05 p.m.): No change. The 1300.70 resistance remains critical to my outlook for gold over the near-to-intermediate term. _______ UPDATE (Aug 14, 5:56 p.m.): If the futures slip beneath the 1285.90 midpoint Hidden Pivot support that contained today's selling, look more more downside to 1280.30, a minor retracement target that you could bottom-fish with a stop-loss as tight as four ticks (60-min, a=1295.30 on 8/14 at midnight). _______UPDATE (Aug 15, 8:14 a.m.):  For the third time since April, December Gold has receded from the 1300.70 Hidden Pivot resistance without having penetrated it decisively.  Rinse and repeat. This is neither particularly bullish nor bearish, but it does affirm my earlier advice to tune out gold until it does something worthy

Thursday's modest rally deserves the benefit of the doubt, since it surpassed the midpoint Hidden Pivot resistance of the minor, bullish pattern shown. It projects to 1282.90, but it would take a decisive move past that number to suggest that buyers have the gumption to keep the rally going. If they do, that would take the futures up to at least 1293.80, where they would face the same test that they passed this morning with their subdued upthrust. _______ UPDATE (Aug 4, 10:58 a.m. EDT):  And down we go again -- a nasty, out-of-nowhere $15 selloff for no 'good' reason.  From the chat room, here's a note I posted moments ago for those who may have grown weary of gold's increasingly frustrating behavior: "Gold rarely fails to disappoint, Giovanni. Re-read the last half-dozen or so gold touts in the archive for perspective. I try to cast gold in the most positive light possible, but without implying that it's about to 'do something'. It's not, and there's no point in getting enthused about bullion until such time as it clears some key technical hurdles. The election night peak should be your benchmark."

I've switched to the December contract, displaying enough price bars to temper even the permabull's overripe enthusiasm for gold at the moment. Not that there's much cause for worry, either.  For in fact, the picture is so utterly hum-drum, with repeated, gratuitous swings of nearly $100, that it cannot but prepare you for more hypnotic, meaningless price action. We'll have mild reason to perk up if the current rally shreds its way past the 1290.00 'external' peak that I've labeled, but until then I can only suggest that you get back to your nap and enjoy a good snooze._______ UPDATE (Aug 2, 11:54 p.m. EDT): If the futures haven't rallied above 1270.30 overnight, look for more slippage to at least 1262.30 in the early going. A breach of that minor Hidden Pivot support would send them even lower -- to as low as 1254.20 over the near term if the selling turns strident.

Gold did what we asked of it on Friday but not much more. The August contract need only have achieved a 1268.70 target first broached here nearly a week ago to stay on a bullish track. The actual high was 1270.00, or 1.30 points more than we'd required. The overshoot was not sufficient to ensure a robust follow-through on Monday, but it nevertheless generated a very subtle impulse leg that we may be able to use to get aboard with entry risk tightly controlled. I have sketched the ABC pattern for your guidance, but initiating the trade could be tricky due to the relatively tiny k-A segment.  It implies that even Friday's minuscule pullback from the intraday high may prove sufficient to have created a valid b-c leg. For that reason, the trade is recommended for experienced Pivoteers only.

August Gold encouraged with an end-of-day reversal that tripped a 'counterintuitive' buy signal at 1249.30 (see inset). We anticipated this during this morning's tutorial session, which you can access in recorded form if you were registered for the class but unable to attend. In after-hours trading the futures looked like an easy bet to reach the 1267.60 target shown, but we should expect buyers to do a little better than that if this rally is going to get legs._______ UPDATE (Jul 27, 5:33 p.m. EDT): Yes, I'm wondering like you why buyers are having such trouble pushing this brick just a few more inches to my target. It is not exactly a sign of good health that they failed to so on Thursday. Actually, gold is at a very crucial threshold where it is likely either to fly or die in the weeks ahead. For my detailed comments on this, click here for an interview I did Thursday morning with Cory Fleck of The Korelin Report. _______ UPDATE (Jul 28, 12:40 p.m.): Hip-hip hooray, sort of.  Gold punched through 1267.60, topping so far at 1269.80. That's not enough of an overshoot to celebrate, but it sure as heck isn't a negative. Traders can use the 1268.50 look-to-the-left peak recorded on 6/14 to set up a camouflage entry. On the 15-minute chart, the subtlest imaginable point 'A' lies at 1264.60 (today, 1:00 a.m.).

Friday's strong finishing stroke to a generally positive week created the first bullish impulse leg we've seen on the hourly chart in more than a month. Under the circumstances, caution is warranted if not necessarily skepticism. Trade with a bullish bias when activity resumes Sunday evening, but don't expect to get aboard the easy way, since the steep pitch of Friday's opening bar will have turned more than a few fence -straddlers into fickle fans. The rally would begin to look interesting if and when it exceeds the 1260.00 peak that I've labeled. Until then, however, the 1194.40 downside target we've been using as a minimum downside target will remain very much in play. _________ UPDATE (Jul 20, 12:06 a.m. ET): Thursday's rally generated a minor bullish impulse leg on the hourly chart. Now, if buyers can push this vehicle above June 28's 1255.70 peak by the close, bulls would have something to feel good about over the weekend._______ UPDATE (Jul 25, 6:15 p.m.): A minor correction on the hourly chart suggests a possible buying opportunity:  Bid 1246.00 for a single contract, stop 1245.40.  Click here for a visual explanation._______ UPDATE (Jul 26, 8:51 a.m.): Suh-prize suh-prize. Gold looks like crap yet again, having stopped out the bottom-fishing gambit advised above for a $60 loss. The overshoot of the downside target implies more weakness to come, presumably to test lows recorded a week ago near 1235.

We've been using an 1194.40 correction target for a while, but today's chart, a continuous daily, shows a bigger picture that is intended to ward off despair. First the bad news.  The red abc pattern projects to as low as 1100.60, a $116 drop from these levels. That is my worst-case scenario for the next 8-10 weeks, and the odds of this target being reached would shorten if the futures were to close below 1195 for three consecutive days.  The good news is that there is a much larger, bullish pattern that has so far prevented selloffs in 2017 from turning seriously ugly. The pattern projects to as high as 1452.60, but July Gold would need to rally decisively above 1288.30, a midpoint Hidden Pivot, to become an odds-on bet for a shot at that target.