Gold

We're using a 1238.90 rally target for now, corroborated by last Wednesday's surge to within a dime of its midpoint 'sibling' at 1208.60. While it's disappointing that the futures have not gone on to achieve the higher target straightaway, neither have they given up much ground. The fact that they've maintained altitude suggests that the move is a consolidation, but this would still need to be confirmed via a push above 1208.90 (see inset).  That's the midpoint pivot of a minor rally pattern, and its decisive breach -- meaning by $1.00 or more -- would imply the futures are on their way to 1223.90 over the very near term. Traders looking for a way in should focus on bullish ABC patterns on the 5-minute chart or less.

Yesterday's strong rally, amounting to $26 from low to high, topped within a single tick of the 1208.60 target I'd provided. This validates the pattern itself (see inset), with the implication that any upthrust exceeding the high would be a good bet to reach 1238.90 precisely. That is the Hidden Pivot 'sibling' of yesterday's target, and odds are good that it will be reached. I say this because the rally itself refreshed the bullish impulsiveness of the intraday charts when it exceeded some 'external' peaks from last week. The pullback thus far has been shallow, but traders should use the small ABC pattern at the rightmost edge of the chart to generate an entry signal. To limit risk, the actual trade should be done on chart of 3-minute degree or less once it has been tripped on the larger charts. Join Rick before the bell Thursday morning for some timely technical analysis. We'll look for trading opportunities in some of your favorite vehicles ahead of the holiday weekend. Click here to register.

Although gold has gone reliably opposite stocks lately, it is getting precious little lift so far Tuesday night despite the fact that index futures are under heavy selling.  In any event, it'll take another $5 of upside to trip a bull signal for the pattern shown. It projects to 1208.60, the midpoint pivot, or to 1238.90 if any higher. This would be quite bullish, since it would not only exceed last Thursday's bull-trap spike, it would also generate a powerful new impulse leg by taking out March's high, an external peak at 1223.60 that was recorded exactly a month ago. ______ UPDATE (4:10 p.m.):  The 1208.60 target flagged above caught the intraday high of today's $26 rally within a single tick. Always pleased to hear, as  I did, from subscribers who used the target to profit.

June Gold’s chart leaves a little more room for corrective weakness than did the March futures’ chart. Specifically, the selloff of the last three days has yet to breach the 1180.70 Hidden Pivot support of the patterns shown. If that were to occur, we would have to infer that more downside to at least 1173.30 awaits. That target is calculated by simply sliding up to the commanding high at 1220.40 as a point ‘A’ for the downtrending pattern. Traders should be aware that the 1190.90 midpoint pivot of the first pattern could have been shorted ‘mechanically’ at around 6 a.m. EDT Monday to produce an eventual profit of about $1000 per contract. For your further information, a mechanical short from the 1187.20 midpoint pivot of the larger pattern is already ‘live’.

Friday's dirge was dispiriting, but we can take a patient view nonetheless because the weakness merely touched the 1191.60 downside target I'd broached here without demolishing it. The decline left us with the prospect of a marginally lower low on Monday at 1186.90, calculated by shifting the b and c coordinates down a peg (to B2/C2). You could bottom-fish there with a stop-loss as tight as four ticks. Alternatively, the futures would need to close above 1208.40, the midpoint pivot of the large ABC pattern shown, to suggest bulls are about to roll. _______ UPDATE (March 30, 9:38 a.m.): As usual, gold took the path of least resistance by moving lower overnight. The move has generated a new downside target at 1173.50, calculated by sliding point A up to last week's high, 1219.50.

For once, gold did a little more than we asked of it, rallying yesterday to a 1219.50 peak that exceeded our minimum expectation by fully 12 points. The next rally leg could carry to as high as 1232.70 (see inset), assuming the 1199.30 point 'C' low of the pattern shown holds. Trades should look for a 'camo' buy signal on charts of 5-minute degree or less once 1207.70 has been reached. As always, an easy move thereafter through the 1216.00 midpoint pivot would be telegraphing more upside to D=1232.70. ______ UPDATE (9:16 a.m.): Gold worked its way lower overnight, never tripping a buy signal. That would come now at 1203.40, with p=1211.70 and D=1228.40. but I am no longer recommending the trade, since gold rarely moves strongly higher during the regular session..

April Gold did precisely what we asked of it on Friday, but little more. I'd projected an easy move to 1186.70 if buyers easily dispatched a Hidden Pivot midpoint at 1172.70. This they did, in the wee hours of Friday morning, eventually achieving an intraday high of 1187.40.  Although that slightly exceeded my target, the overshoot was not sufficient for us to infer that significant buying power remained to be spent over the near term. That could change when the markets open Sunday evening, but I wouldn't get excited over a move merely to the 1194.00 target shown. That would do no more than extend Friday's rally to the maximum target of the pattern we'd used to project to project the original one at 1186.70. If bulls are to demonstrate that they've got significantly more in mind, let them telegraph it with a thrust exceeding the 1197.70 'external' peak recorded on 3/6 (see inset).  It is subtle enough that a BC-type pullback from just above it could provide an excellent if belated boarding opportunity for bulls who have been on the sidelines.  Entry below those levels, if warranted, will be difficult at best, even using the 'camouflage' technique, because there are few handholds to leverage along the steep wall of the decline that occurred on March 6. _______ UPDATE (March 23, 9:27 p.m. EDT): Yesterday's timid rally was not very encouraging, but the analysis above can stand as given, at least for now. _______ UPDATE (March 24, 4:31): Today's equally timid rally topped at 1194.50, just 0.50 from where I'd predicted.  Bulls will have to do better than that to warrant our enthusiasm. The next step up would be to a minor Hidden Pivot target at 1197.10. As always, an easy move through it would offer the sort of encouragement

For once in a rare change, gold futures have actually held onto a gain achieved the previous day. Although they made no upside headway on Thursday, it was something of an achievement for them to have merely stayed aloft. The bullish abc pattern shown has a clear-as-can-be rally target at 1186.70 that has been confirmed by the stall precisely at 1172.70, the 'p' midpoint pivot. As always, an easy move through p would imply more upside to D, at least. If bulls are revved up and ready to blast off, they should be able to surpass 1186.70 today without much trouble.

As I mentioned in today's E-Mini S&P tout, I like to fade big moves when they occur for stupid reasons or no reason at all. Under the circumstances, there's no way I'm going to go with the flow in gold. Has anything really changed as a result of yesterday's non-news from the Fed?  Surely not. And that is why I expect this rally  to go nowhere. Before we throw ourselves in the path of a freight train, though, let's see how bulls handle the two Hidden Pivots shown. They lie, respectively, at 1173.30 and 1185.20. The first, a midpoint resistance, has been penetrated, but not by enough for us to infer that a follow-through to D=1185.20 is a done deal.  Only if buyers bulldoze the latter resistance, and soon, should we infer that more upside progress is likely.