Gold

Unaccountable forces have driven a $15 push higher late Tuesday night, and although the so-far apex of the move has fallen a tad shy of the 1339.00 benchmark I'd said would generate a bullish spark, the actual high at 1338.40 was good enough to create a moderate impulse leg on the lesser charts. Since the move has yet to break above any true 'external' peaks, however, the one at 1338.90 (see chart)  remains usable for camouflage purposes. That would be especially true if the rally that exceeds it fails to clear the slightly higher peak at 1340.50 before pulling back in b-c fashion. If that is in fact what occurs, you shouldn't hesitate to seize the opportunity with a buy-stop entry.

If sellers dominate as the week begins, expect the futures to fall to the midpoint support at 1250.40, at least (see inset).  This Hidden Pivot could prove crucial to the near-term picture, since its decisive breach -- or still worse, a close below it -- would augur more downside to 1152.10.  Notice as well that this last number discounts only the lowermost of a series of point 'A' peaks; if the highest of them (1423.30) were to be used, the implied D target would be 1104.80.  Alternatively, bulls would be solidly back in command if they can muster a push above 1376.00 this week. Camouflage traders looking for an easy way to climb aboard should use peaks recorded last Wednesday, Thursday and Friday on the hourly chart for leverage. ________ UPDATE (July 30, 12: 20 a.m. EDT):  Yesterday's snoozefest did nothing to alter my forecast.  However, we can lower the bar for bulls by using a 1338.90 peak made on July 26 (60-min at 3:00 a.m.) as the number they'll need to beat to register a pulse.

The bounce from yesterday's low came from a good place -- the midpoint support of a minor corrective pattern. It was not sufficiently robust, however, to generate a bullish impulse leg on the hourly chart; that will require a modest thrust exceeding 1344.80 (peak #1) today.  Note that there are three other peaks just to the left of it, and a pullback from above any of them but the last could provide an excellent opportunity to jump aboard.

Yesterday's selloff was bearish impulsive on the hourly chart, but notice that it began from a high that had exceeded a 'look-to-the-left' peak at 1347.50. The effect was to refresh the chart's bullish energy, even if the current dynamic is a presumably short-term duel between bulls and bears. The latter cannot but reveal their strength, or lack of it, at the p midpoint of the corrective pattern shown in purple. If the larger, bullish ABC pattern is about to resume in earnest, the corrective abc should reverse from p or higher. _______ UPDATE (10:41 a.m. EDT): The futures ultimately bounced from a low at  1308.40 that was close enough to the eventual 'p' at 1309.10 to yield a picture of strength.  When corrections fail to reach their 'd' targets, as occurred here, that is always a bullish sign. Use 1387.70 for a rally target now (60m, A=1269.30 on 7/17), subject to midpoint resistance at 1348.10. A buy signal has been tripped at 1328.30, so hunting for 'camouflage' is appropriate.

Gold's encouragements continued yesterday via a rally at a time of day when rallies seldom begin. The moderate spike at around at 3 p.m. remained a work in progress as of late afternoon and targeted 1351.80. This would be a downpayment on the 1361.00 target we were already using as a minimum upside projection for the near term. Night owls have a green light to get on board the bullish bandwagon via camouflage, since the 1338.70 midpoint resistance of the pattern targeted on 1351.80 (see inset) has been exceeded by a decisive $8.  If the target itself is easily brushed aside, regard it as all but guaranteeing a continuation to at least 1361.00. ______ UPDATE (1:31 p.m. EDT): Today's dive was bearishly impulsive on the hourly chart and negated the 1351.80 target.  We'll know how serious the weakness is once we've seen how the second leg down behaves. First, however, there must be an upward, b-c correction of at least $5.

Gold futures have opened sharply higher Sunday night, trading just off a 1319.30 peak that lies $8 below the 'crystal clear' target at 1327.00 we've been using as a minimum upside objective for the near term. If that number is exceeded by more than $1 or so, the August contract would be telegraphing more upside to at least 1335.80 (see inset), the Hidden Pivot target of a lesser pattern begun with  tonight's upthrust. _______ UPDATE (1:33 p.m. EDT):  The August contract has shredded minor targets -- and one major one -- this morning with easy aplomb. The implication is that this run-up is bound for 1361.00. That Hidden Pivot is not likely to give way easily, so be prepared for a stall. If none occurs, however, bears and the bad guys (i.e., the bullion bankers) had better dive for cover.  Even so, we should never discount the fact the their good buddy, Uncle Sam, is capable of lending however much gold it takes to halt this lovely insurrection.

As noted in the chat room after Thursday's close, August Gold looks to be consolidating for a thrust to 1327.00 now that the rally has exceeded the crystal-clear target of a lesser pattern at 1288.50 (see inset). Night owls looking for 'camo' entry opportunities should use the 1289.00 trigger of the pattern shown (60-min: A=1246.10 at 2:00 p.m. on 7/10, where p=1301.70). The purple ABC coordinates show this.  ______ UPDATE (July 18, 12:30 p.m. EDT): Yesterday's nasty reversal, triggered by more intelligence-insulting blather from Fed PR-meister HeliBen, left our rally target intact, but it also generated a bearish impulse leg on the hourly chart (see inset) that bears watching.  The b-c follow-through has yet to develop, but if the resulting pattern reaches or exceeds its D target, be prepared to reef the sails. _______ UPDATE (July 19, 1:23 a.m.): It would be quite bullish if August Gold were to push above Wednesday's 1299.70 peak without having touched the 1278.70 midpoint correction target of the pattern shown.

Most unusual: Gold , index futures AND the U.S. dollar were all trading moderately higher early Monday morning. Are traders perhaps unclear on the concept (whatever it might be)?  In any event, it's a good time to look at gold's chart in isolation from the seemingly anomalous. Accordingly, and mechanically speaking, the August contract wants to ascend to at least 1264.10 (or perhaps to 1266.30, based on a slightly lower 'A') over the very near-term. Notice how buyers pushed it well past the 'p' midpoint within the last few minutes. That make a follow-through to the target all but certain. It would also leave the futures well shy of the 1301.80 print required to generate a no-doubt-about-it bullish impulse leg on the hourly chart. Still, higher is better than lower, and it will at least earn bulls the benefit of the doubt, assuming price can hold aloft overnight and into the start of the regular session. _______ UPDATE (11:40 a.m. EDT): The point 'C' low of the rally pattern has been violated, negating the target. More significant is that the top of today's rally failed, in chicken-hearted fashion, to take out last Wednesday's 1259.30 peak. It did take out a slightly lower peak a couple of bars to the right of it, but the pullback that followed couldn't even generate a profitable 'camo' trade of leastmost degree. This feeble action has bearish implications for the moment, although it's nothing that a thrust exceeding 1279.00 couldn't cure. A print at 1279.10 would generate a bullish impulse leg on the 30-minute chart. _______ UPDATE (July 10, 11:45 a.m.): Today's upthrust has put August Gold back on track for a run-up to at least 1287.90. The move is not only bullishly impulsive on the hourly chart, it appears to have converted the 1247.40

Although I try to keep subscribers on top of encouraging signs in gold, there's little value in my trying to sugarcoat the technical evidence at hand. To be as straightforward as I can right now, that means acknowledging that August Gold's bounce from the June 28 low at 1179 has not been nearly strong enough to suggest that a major bear market has ended.  More immediately, and from a purely technical standpoint, the weakness of the last few sessions has transformed a promising, bullish impulse leg into a duel between bulls and bears.  To be sure, the larger of the conflicting patterns is intact and still bullish. But as of early Monday morning, the smaller one dictates trading from the short side if scalping.  The chart (see inset) shows what would need to happen for bulls to regain the upper hand -- i.e., a price reversal from p or above that rallies above the red 'A' without pausing for breath.  However, it would take significantly more than that -- specifically, an uncorrected thrust to 1301.80 on the hourly chart, to refresh the bullish energy of the three-day rally we saw from 1179.