Gold

Yesterday's blitzkrieg rally was sufficient to turn all of the intraday charts -- although not the 'daily; that would take a print at 1353.90 -- bullishly impulsive.  It won't require much of a pullback to prep the December contract for another leg up, but when it comes, you should try to board at the signaled 'x' entry point, zooming down to perhaps the three-minute chart to find an equivalent and less risky 'x' in microcosm. I've sketched this out (see inset) for your further guidance. _______ UPDATE (12:07 p.m. EDT):  All signs are still bullish, but the futures are taking their sweet old time consolidating. In practice, this will make it difficult, at least today, to get long via camouflage. I'd be tempted myself to stake out at least a small position at the close, however, since a continuation of the uptrend on Sunday seems like a better-than-coin-toss bet, at least to me.

Buyers have managed to push the futures to the midpoint resistance of the pattern discussed here yesterday, but the action at the red line is too timid to offer any assurance that the 1302.80 target with which it is associated will be reached. Regardless, because the rally refreshed the bullish impulsiveness of the lesser charts, it should be traded with a bullish bias. This implies entry at an 'x' trigger such as the one shown. Because the theoretical entry risk would be around 1.80, though, you'll need to initiate the trade, camouflage-style, at the point 'x' of an even smaller pattern. My guess is that you may need to drill down to the 15- or 30-second chart to find the opportunity you're looking for. _______ UPDATE (10:51 a.m. EDT): On the 3-minute chart, the first 'camouflage' entry trigger that perfectly met our criteria occurred at 3:21 a.m.:  1278.80. The initial theoretical risk was 1.20, but one could have reduced it to as little as 0.30 on charts of sub-minute degree. If at least two fills are reported in the chat room, I'll establish tracking guidance.

Gold has bounced $27 from within a few ticks of the 1250.50 target we'd been using as a minimum downside objective for weeks, but now what? Someone asked in the chat room how this Hidden Pivot support can survive if Silver is about to dip below $20 as forecast. The short answer is that it can't -- and probably won't.  That's just a hunch, but we can nevertheless give the December contract the benefit of the doubt right now, since it ended the regular session by creating a second bullish impulse leg on the hourly chart. Moreover, because this latest A-B thrust is not likely to be read by others as a breakout, we can use it to initiate a long position via camouflage. For your further guidance, I've sketched this out in detail in the accompanying chart. _______ UPDATE (October 16, 10:20 a.m.): Trading the pattern I'd drawn could have produced a gain of as much as $1030 per contract overnight, since the futures made it to p=1284.20 and then some without incident after tripping an entry signal at 1278.90. However, the rally died $5.70 shy of the D target at 1294.90, implying that weakness below the surface remains dominant.

Well, Gold finally generated that bullish impulse leg we've waited for so patiently. Unfortunately, and suspiciously, it took a nearly $30 shakedown first (see inset) to sufficiently deplete sellers so that the impulsive rally could be 'arranged'. Under the circumstances, I'll stick with our longstanding target at 1250.50 for now, although I'd become a Raging Bull, at least for the short term, if the December contract were to thrust above 1337.90.  _______ UPDATE (Sunday afternoon):  Just one change: Lower the threshold at which we could infer a bullish resurgence is 1298.40, which corresponds to a minor 'external' peak from 10/10 visible on the 15-minute chart.  _______ UPDATE (October 15, 10:06 a.m. EDT):  Gold has trampolined $27 this morning (see inset) from 50 cents above the $1250.50 Hidden Pivot we'd been using as a minimum downside target for weeks.  Since I had suggested buying aggressively down there, please let me know in the chat room of any orders filled so that I can establish a tracking position for your further guidance.

December Gold's failure to generate a bullish impulse leg on the hourly chart is now at five days and counting -- not very impressive, to put it mildly.  Under the circumstances, I still expect a relapse down to the 1250.50 target shown, although bulls could earn a respite with a pop exceeding the 1337.80 'external' peak shown. Bears show no real conviction either, so we should look for some news tidbit with the vaguest possible tie to the inflation/deflation theme to end the stalemate.

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.