Gold

Gold's timid, laborious climb has used the 1321.20 midpoint pivot again and again as a touchstone, implying that its 1340.3o 'D' sibling should be used as a minimum upside objective for the near term. While low-risk buying opportunities have not exactly been abundant, notice in the chart the tradable 'camo' set-up at the right-hand edge.  If you're reading this and it's around 12:30 a.m. EDT, you may be able to leverage the 1326.50 'buy' signal on a chart of lesser degree.  I've sketched the coordinates for your guidance, including an x entry point already triggered on the '30-minute' but potentially still available in lesser time frames.

Gold's rallies continue to lack conviction, with most minor thrusts falling shy of modest Hidden Pivot benchmarks.  We'll give bulls the benefit of the doubt nonetheless, since they have at least managed to eke out modest gains toward the end of the day.  Yesterday they tripped a minor buy signal at 1319.90 in the late afternoon (see inset), but could not subsequently muster the additional 5-point climb it would have taken to challenge a midpoint resistance at 1325.10.  That'll be our minimum objective as the week draws to a close, and if it's exceeded by at least three ticks, camouflageurs should look for a micro-ABC rally to take them higher. Short-term potential thereafter would be an additional 10 points, but you should take the position home over the weekend only if you're halfway to the target when the bell rings. ________ UPDATE (9:53 a.m. EDT): Gold popped fleetingly to 1326.00 this morning but has since retreated so swiftly that there have been zero camo buying signals this far, even on the one-minute chart. This is not bullish action, but rather, distributive -- rallies that are being ginned up to tease, tempt and titillate. We can participate if we choose, even making money when we are 'wrong', but there are obviously better vehicles to trade. For now, you should keep my 1250.50 downside target in mind when these presumably phony rallies unfold. _______ UPDATE (October 7, 2:36 a.m. EDT): No change. The best thing Gold has going for, technically speaking, is that December Silver still looks somewhat more bullish at the moment than December Gold looks bearish.

Gold savaged my forecast yesterday, uncorking a powerful rally on a day when I'd expected just the opposite. The downside target at 1250.50 remains valid nonetheless, and although I could continue rooting for it until I'm shamed into retreat, I'll revert to the purely mechanical analysis that you have come to rely on.  From that perspective, yesterday's $40 rally was still not very impressive, since the reversal failed to generate a bullish impulse leg on the hourly chart. That would require a print at 1337.90, about $21 above current levels. Traders needn't wait for so obvious a signal to get long, since there's a nice 'hook' for camouflage in the form of a look-to-the-left peak at 1324.90 (10/1 at 9:00 a.m. EDT)  It doesn't even display properly on the hourly chart, but any rally that pulls back in 'b-c' fashion from a tick or two above it would provide a very enticing opportunity to get long nonetheless.

I've been giving the bullish case the benefit of the doubt as the futures have fallen by $157 over the last month, mainly because the impulse leg generated by August's rally to 1434.00 is intact down to 1271.80. Although yesterday's low held $5 above that number, the daily chart strongly persuades that the selloff will continue to at least 1250.50. You can buy aggressively at that price because the downtrending ABC pattern is such a beauty (see inset). However, because we don't have a crystal ball, I'll suggest risking only small change on the stop-loss. Camouflageurs should shoot for four contracts, but if you try this gambit with a straight bid, place it at 1250.60 for a single contract, stop 1249.80. _______ UPDATE (10:12 a.m. EDT): The futures are rallying today, but if the buying goes just an inch farther, reaching the 1312.90 midpoint pivot of the pattern shown, this should be viewed as a 'camo' shorting opportunity. In any event, the rally would have to hit 1375.50 to negate the 1250.50 target.

Index futures are getting shaken down Sunday night as DaBoyz feign fear over the impending government shutdown.  Gold, on the other hand, trading a dime above Friday's settlement price, is providing a calmer and probably more accurate, read on the likely outcome of Capitol Hill's Punch-and-Judy show -- i.e., nada.  For now, the benchmarks that I gave here earlier still obtain.  That means an impulsive thrust below 1272.50 would turn the weekly chart bearish, but that a print above 1353.7o would put bulls back in charge for a possible run-up to 1453.00.

Gold's price action has a nasty way of stressing Hidden Pivot supports to-the-max before the futures turn higher, so we shouldn't take the current ordeal too seriously until such time as 1272.50 is impulsively exceeded to the downside (see inset). Otherwise, the weekly chart will remain bullish, with upside potential on the next thrust to as high as 1453.00. A lesser ABC pattern at the rightmost edge of the chart is also bullish and needs but a two-day close above 1353.70 to energize buyers for a more sustained push.  This is as simplified an analysis as I can offer, and you should familiarize yourself with the relevant price points if you want to be on top of any movement up or down that truly matters.

By climbing out of a hole yesterday, the futures left themselves poised for a follow-through to as high as 1384.90 by week's end or early next. This target will become an odds-on bet once the December contract has exceeded the 1345.20 'midpoint pivot' with which the higher number is associated. These benchmarks come from intraday charts, but the weekly bars show promise as well, since a 1453.70 target would be in play on a two-day close above 1372.60.  Traders looking to get long Wednesday night should use a pullback from just above 1340.50 (an 'external' peak from last Thursday) for leverage.

Two important technical thresholds lie not far below: 1) the 1280.00 midpoint support of the corrective abc pattern shown; and 2) a key structural support at 1271.80.  I would rate the first as the more important, since its decisive breach would probably spell more downside to at least 1126.10, its 'D' sibling.  The 1271.80 structural low could prove analytically useful nonetheless, since any 'running of stops' just beneath it would unburden the futures of profit-takers, presumably clearing the way for a strong rally.  Please note, however, that a marginal penetration of that number followed by a weak rally of perhaps $5 to 10 would be warning bulls to look out below. _______ UPDATE (September 24, 8:37 p.m. EDT): If the strong bounce off yesterday's low continues past 1336.10 today, bulls will not only be out of immediate jeopardy (see above), they'll be in good shape to regain the offensive.  Indeed, a close above 1345.00 would all but guarantee a continuation rally to at least 1384.40. (The provenance of these two Hidden Pivots is shown in the chart, a new one.) Traders looking to get long can use an 'a-b' pullback from between any of the half-dozen or so prior peaks recorded on the intraday charts since last Thursday.

In an update to Wednesday's tout, I said the December contract is bound for at least 1453.70. This Hidden Pivot target (see inset) would become an all-but-certain short-term bet if buyers can ram this vehicle past the 1372.60 midpoint resistance shown. They've made fabulous progress so far, with a war-whoop rally in after-hours trading that has hit 1367.80. Clearly, the weasels who love to bet against gold are on the ropes, short up the wazoo and wont to grow even more desperate. However, we should never count them out, since they are indeed very clever guys with friends in the highest places.  That is why we should assess the further potential of this rally one leg at a time, using purely mechanical tools, instead of tuning to the likes of Jim Sinclair for pie-in-the-sky numbers and false hopes. Keep in mind that gold is a trade, not a religion. On the daily chart (not shown), if the 1453.70 target is achieved, that would exceed a small 'external' peak at 1447.10 recorded on May 14. That in turn would effectively refresh the bullish energy of the hourly chart, creating even more pain for the weasels -- and therefore even higher prices for gold. Traders looking to get long at any point along the way should watch for impulse legs on the hourly chart, but on charts of 5-minute degree or less for 'camouflage' entry signals. Catching a ride on this projectile would become increasingly tricky as the rally draws in more short covering and more bulls, but there is surely enough talent in the chat room to spot the opportunities, and so that's where you should hang.  _______ UPDATE (6:24 p.m.):  Gold traced out a tight flag Thursday (see inset), presumably consolidating the powerful run-up from a day earlier. Although it