Gold

Thursday's selloff exceeded not only the 1207.30 downside target we've been using for nearly a week, but also the watershed low at 1207.00 recorded back in May. This is technically very damaging and would become still moreso if the selloff goes on to exceed February's 1194.00 external low within the next few days. That would added to the imputed power of the downtrend, leaving only one last line of defense for bulls at 1198.00, the maximum downside target that can be projected using the daily chart (a=1383.50 on 7-11-16; b=1243.20 0n 10-07-16). _______ UPDATE (Nov 20, 8:07 p.m. EST): The December contract touched a low of 1201.30 on Friday, putting it on very thin ice. The supports flagged above at 1198.00 and 1194.00 remain crucial to the immediate picture, and their breach over the next day or two would have very bearish implications for what remains of 2016. Alternatively, a rally touching 1219.00 today would offer a smidgen of encouragement.

Even after plummeting to the 1233.70 target I'd flagged the night before, gold looked so awful on Friday that I posted two still-lower Hidden Pivot targets in the chat room: 1223.90 and 1207.30. The first was breached by $3.60 before the session ended, implying more slippage is likely. The lower number can serve as a worst-case target for the near term, but please note that there's an additional 'hidden' support at 1217.20 where a bounce could occur. _______ UPDATE (Nov 14, 11:18 p.m. EST): Subscribers reported leveraging some 'camouflage' patterns to get long Monday, and the futures were about to trip another minor buy signal tonight (a=1219.80 at 6:30 p.m.), but the bigger picture still warrants caution. Bulls could breathe a sigh of relief if the rally hits 1237.10 on Tuesday. _______ UPDATE (Nov 15, 7:33 p.m.): Zzzzzzzzzzzzzz.

Gold's Whoopee Cushion rally on election night is going to take a heavy psychological toll on traders, most particularly bulls who got trapped buying at or near the fleeting top. This parallels what occurred in stocks, when DaBoyz pulled their bids on ginned-up fears of a Trump victory, sending the Mini-Dow plummeting 900 points overnight. Bears got trapped so badly by this maneuver that they were easily goaded into pushing the futures into a parabolic rally the next day that recouped overnight losses plus another than 300+ points. Gold has yet not broken down in corresponding fashion, but bulls will be so dispirited over the gratuitous hump on the charts that it will look like Everest in the days ahead. From a technical standpoint, we might expect the futures to ease lower, to at least 1233.70 over the near term. That target is easy to find on the daily chart using these coordinates: A=1347.80 on 9/22; B=1243.20; and C=1338.30.

The futures relapsed without having gotten past the higher of two bullish benchmarks posted here yesterday. The subsequent fall beneath a 1276.70 midpoint Hidden Pivot support makes more weakness to d=1261.80 a good bet at the moment, although one could also play for a bounce from that target.  If buyers fail to generate much of one, that would indicate still more weakness in the days ahead -- presumably to structural support in the range 1240 to 1260. A surprise win by Trump would probably send prices higher, but be wary of any rally that falls shy of 1331.50, where a key peak was recorded September 20 on the way down..

Gold did not rebound as sharply as silver off Monday's lows, even if the December contract bullishly failed to achieve a 1277.10 downside target before turning around. The reversal has yet to exceed any 'external' peaks on the hourly chart (see inset), however, and it will now take a strong push to achieve this feat. The first peak lies at 1289.50, but buyers would need to get past the second, at 1296.50, to suggest they've got the moxie to go on the offensive. Significantly higher targets would then become plausible, but we'll look for a more modest show of strength before we even consider those targets.

Thursday's wacky, Whoopee Cushion bounce came off a low that missed my target by $1.80. The premature upturn was speculatively bullish, but the rally became manifestly so when it started exceeding prior peaks on the intraday charts. We don't want to be too presumptuous, however, considering how violently bulls got shaken out, so I'll suggest entry strategies that use small ABC patterns at the rightmost edge of the chart. The one shown, with an A low at 1297.80, has a play left to 1306.60, but leveraging this set-up could be more trouble than it's worth. Instead, I'll suggest waiting for a fresh A-B thrust that tops out between #1 and #2 before pulling back into a tradable pattern. That's a narrow window to be hoping for, but if we get what we want, the result could be easy pickings. _______ UPDATE (Nov 6, 8:09 p.m. EST): Moments ago, the futures tripped a moderately appealing counterintuitive 'buy' signal by rallying from a deep hole back up to the green line (see chart, a new one). The signal can be 'actualized' in numerous ways, but night owls will probably do best to fashion a 'camouflage' entry trigger on the five-minute chart or less.  Incidentally, the futures have rallied nearly $2 since I began typing this update, attracting more bulls and therefore warranting greater caution.

Gold futures surged $20 today, exceeding by nearly $3 the ambitious, 1289.10 rally target I'd flagged two days earlier. Moreover, the December contract appeared to be consolidating at the target line, suggesting that another leg up is coming. If so, the rally would need to hit 1313.00 to refresh the bullish energy of the hourly chart. That's where the first 'external' peak above these levels lies (see inset), and any uptrend destined for still greater heights must easily exceed it to bolster the case. Although I'd noted that the futures tripped a 'mechanical' entry a day earlier at 1274.60, I haven't established a tracking position because there were no reports in the chat room of any subscriber having gotten aboard on the dip. Even so, several traders reported using the target to bolster their confidence while holding long positions on the way up. ________ UPDATE (Nov 3, 7:46 a.m. ET): After a failed rally attempt overnight that fell $1.30 shy of Wednesday's 1309.30 peak, the futures have gotten whacked. The higher of the two peaks missed hitting the 1313.00 benchmark I'd set to refresh the  bullish energy of the intraday charts by a country mile.  The so far $23 selloff that has ensued is bearishly impulsive on charts of 15-minute degree or less and projects to a minimum 1284.30 (a=1303.60 at 3:15 a.m.; b=1292.50 at 5:00 a.m.).

Three weeks of trying, sort of, have failed to push this brick above the modest 'external' peak at 1279.40 shown in the chart. It would be premature for us to give up, especially since a mere $9 upthrust from current levels would do the job. That would turn the hourly chart bullish, but we'll wait for it to happen before we breathe a sigh of relief. Not a big sigh, though, since the daily chart still looks menacing and provides ample reason to fear a drop of as much as $104 points at any time. Alternatively, it would take a print at 1287.60 to trip a theoretical buy signal on the 'daily'. _______ UPDATE (Oct 30, 10:16 p.m. ET): Friday's encouraging leap fell $2.20 shy of our 1287.60 benchmark, but it left the futures in good position to achieve the 1289.10 target shown -- and then some.  If the rally pushes easily past that Hidden Pivot, it would be bullish, but the December contract would then need to rally a further $42.60, topping an 1331.50 'external' peak from 9/30, to generate a fresh bullish impulse leg on the hourly chart. _______ UPDATE (Oct 31, 9:16 p.m.): Today's dipsy-doodle generated a mechanical 'buy' signal at 1274.60, stop 1269.70. Let's see now whether bulls can score from the three-yard line.

Just when you think you've got gold figured out, it pops a wheelie in the opening hour and zooms higher at a time of day when bullion rallies seldom occur. The move left the futures just shy of the 1278.80 target shown, but if buyers take out this Hidden Pivot resistance as I expect, look for the move to hit 1284.80. That target can be calculated by simply sliding the point 'a' low down to 1251.20, where the December contract bottomed on October 17 to commence a four-day rally. _______ UPDATE (Oct 26, 7:04 p.m.): Buyers stalled a whisker shy of the 1278.80 target, then spent the remainder of the session in relapse. The short-term picture remains bullish nonetheless, going back to a rally begun on October 14 from 1246.90, but it would turn bearish with a print below 1257.20. It is not a healthy sign that the futures were unable to achieve 1278.80.