Gold Intraday Correction Update

Some investors may be unloading gold inventory which was bound to happen after a vertical move.  The question is how deep can gold go? Below $1485 would be nice but I’ll be open to a deeper plunge if need be.

Any correction means another leg up in the gold price is still to come.  I’m looking for diagonal connections, as the mainstream media was all charged up for $1600 gold.  We sure don’t want to disappoint them if gold crashed to $1400!

Silver is also taking a hit but it has a lot of catching up to do and is lagging behind gold like it has done many times before.

Some analysts are already calling for $2200 gold but they have been doing that since the 1970s.

Hits: 6

Gold Intraday Crash Update: Fast And Furious!

The bottom fell out of the gold price with a near-vertical drop that also left an open gap in its wake.  Sudden drops like this happen as there are “No” daily trading limits in commodities.

The only question is how deep gold can still go as downward spikes like this can be a very bullish sign. Stocks/Oil exploded, but the gold and silver price headed south.

There should still be more upside, as the pattern so far, does not suggest a long gold price decline. Besides that, the $1600 price range is a much better resistance level than $1535 is.

The full moon is just a few days away so that can act as a reversal time period. Gold already recovered about $10 so that is also a good sign.  I see it as a warning that later on when stocks start a real bull market that gold will decline as stocks supply the real competition for gold-related assets.

The 2011 gold peak is a prime example of what can happen.

Hits: 7

Gold 2015-2019 Review

Originally the 2015 bottom was wave 3 in Intermediate degree but that started to take far to long, so I looked for a higher degree position.

I have been using the (A) wave bottom for 3-4 months and at this time don’t see any reason to change it.

At this time the present bullish phase is what I call a “C” wave bull market, which still has a long way to go. Diagonal wave structures can develop at any time, and I still need to see some sort of Minor degree wave 3-4-5 structure to play out.

EWI (Elliott Wave International) has the same bottom for December 2015 as I do so they are bullish as well.

Yes, we should get corrections as nothing travels in a straight line for very long. The last thing I want to do is turn bearish on gold too early!

Gold was well above $1500 at one point and I’m sure $1600 is within reach this year.  August 15, 2019, will be the next full moon which can trigger surprise reversals.

Hits: 14

Gold Weekly Chart Bullish Phase Update

Gold investors are jumping on the gold bandwagon as they think it will protect them from the savage stock market gyrations.  Short term it will work but long term investors know that gold can reverse with little warning.  I think there is more upside as a 5 wave sequence in Minor degree seems to have started.

Many may think that the gold bottom of late 2015 ($1050)  is a major bottom but in Primary degree.  We are not in a Cycle degree bullish phase so eventually, I will turn very bearish.

I have seen some EWI gold wave counts a few months back and we have the same “A” wave bottom in Primary degree.

This is very rare but they have a huge following reading their newsletters and when EWI turns bearish all of their subscribers will know it.

I’m still very bullish on gold and it may last all year or until stocks have crashed significantly.  For now, this gold bullish phase should continue, so enjoy it as all trends eventually come to an end.

Hits: 18

Gold Intraday Gyrations Review.

This is the August Gold contract as the cash chart has too many erroneous spikes at this time.  Prices will be a bit different as this gold market is still advancing. I don’t want to see new record lows in gold but a deep plunge can also happen before gold starts to crank up again.

Commercials are close to having record net short positions but it’s the speculators that can panic sell at the drop of a dime. This Fridays COT report may tell us more.  There is a good chance that the “C” wave bull market is alive but we need more evidence to support it with the development of wave 3-4-5 in Minor degree.  Once gold soars to about $1500 + then I’m sure the gold bulls will be jumping up and down with joy.  When they all agree that gold is bullish then gold can crash and wipe the smiles off anyone that buys when prices go vertical.

In the long run, I’m working gold as a big bear market rally so very choppy waves in a bull market are very normal.

Hits: 10

Gold Weekly Chart Bullish Review

My focus is always to link all Cycle degree connections first which I work with 3-degree levels below and 3-degree levels above Cycle degree.

I believe the 2011 peak is a Cycle degree peak and what followed was a bear market decline, ending in 2015 with 3-degree levels. I had 2015 low as a wave 3 bottom but It took far too long to play out, so 2015 becomes the “A” wave bottom in Primary degree.

Higher lows are clearly visible with the “B” wave in Intermediate degree (Red), stopping the gold crash in its tracks, August 2018. ($1160) I bet not too many people remember any fundamental logic about why gold started to soar.

With any wave position its always a reminder so we can never forget where the wave count started from.

I believe a “C” wave bull market is in progress and we still need waves 3-4 and 5 to show themselves in Minor degree.

I will not post every single little wave count as they become irrelevant due to the fact that it’s impossible to find our mistakes. If we just use 3-degree levels and count out 50 positions, then you have a minimum of 150 wave positions that could all be wrong!

In the long run, I see this as a bear market rally and there should be more upside to come.

Hits: 10

Gold Intraday Bullish Update

Once I saw gold maintain a corrective type of a move I knew that any bearish scenario would have to be put into the deep freeze for now.

There are three spikes that show but you can ignore them as they don’t show up in Line type settings.

Many contrarians have been calling for a higher gold price and I’m sure the gold wave counters have cranked up their bullish wave counts as well.

The above wave count is about as bullish as I can show you, as this may be part of another zigzag bull run.  This wave count can also be a wave 3-4,  but I like to work with only one option at a time.

Yes, the commercials are net short and it will get worse if the gold price keeps rising.

Regardless what your long term gold price forecast is the entire wave counting community has to decide if this 3.5-year bullish phase is just a big bear market rally?

In the near term and if gold has the legs, then $1600 could be the next price target.

What nobody talks about is that the price of gold is soaring while solar cycle 24 is still crashing!  This is not a good long term picture as the gold price could be repealed down, by the start of solar cycle 25.

It’s still a year or so before solar cycle 25 starts, even though the first official sunspot of solar cycle 25 has already arrived.

Hits: 9

Gold Resistance at $1800?

I changed my wave positions and basically, I’m now looking for a 3-3-5 wave count and if the (A) bottom is real,  then another leg up would certainly happen.

I will only run one wave count in a chart with no other alternates as otherwise, it’s impossible to find our mistakes. Majority of my wave counts are drawn on a printout first, so you don’t want to carry the same mistake to a new chart!

We may still get some corrective action but if this bullish phase is not finished then the gold bulls will shred the early gold bears again.

The big question is if this is just part of a bear rally or the start of a new true bull market!? A “C” wave bullish phase is what we could be looking at and it may last out the summer.

Wide open spaces to $1600 but then $1800 is going to give gold some very stiff resistance.

 

Hits: 29

Gold 2011-2019 Review

Mindless wave counting is not what I like to do, so seeing the gold COT report for the first time can be unsettling. Above, the commercials are in a net short position that we haven’t seen since mid-2018. These are bearish signals that very few people read or even consider to be important.

The large speculators have taken the opposite side which is aligned with the majority bullish consensus. Folks, both groups can’t be right at the same time and history has been on the side of the commercial hedgers.

The media always talk about the large speculators who they think are the smart hedge funds. Speculators are the emotional trend chasers and they consistently paint themselves into a corner, where they become trapped.

When the market moves against the speculators you can bet they will run or dump their long positions as fast as they can.

I have another gold COT chart that came from the May 2016 gold peak when commercials were also in a massive short position. Gold also crashed at that time, after which it started a sideways bearish phase.

I still have too many alternates, and I will not post or show alternate wave counts on one chart.  All my wave counts are saved on my hard drive for every month and not having many alternates on one chart saves me time in finding any mistakes.

The majority of wave analysts count out hundreds of micro mini wave counts and I always wondered how do they find their mistakes?

The above gold chart could give us a correction down to the bottom trend line after which gold would crank up again as another zigzag.

We also see this weekly chart where gold is far above both moving average lines and many times gold crashed below both averages before a new bullish phase started back up. It would take little for gold to decline and before we know it, gold has created a death cross on the weekly charts.

Hits: 15

Gold Intraday Update!

I’m at the 5 min scale which is about as small as I can go. This is starting to look like an inverted zigzag which could be a wave 1-2.  In other words, gold can’t blast to new record highs. At this scale, it will not take long because the action is much faster so it should only take a few days for this to produce a newer low.

I posted a group of futures contracts that took gold to December 2024, producing a $123 spread higher than the cash price. This is a huge spread and I checked again today and the spread has already compressed to $104. This spread should keep compressing once any decline in the gold price gets serious.

The experts say that as long as gold stays above $1400 it remains bullish but below that gold will be bearish. Good luck with that!

With cash oil and the December 2021 contract, oil is about $4-$5 lower than the cash price.  This is very bearish for oil.

With gold, I will check the spread more often as I would expect it to keep compressing.

 

Hits: 7

Gold Daily Chart Update

Last night gold pushed to $1411 after which it started to back off.  Short term, golds rally may add another leg up but I think that a correction is due

The entire gold bullish phase that started back in late 2015, from the $1050 price level, will soon be 3 1/2 years old.

3 1/2 years for an Intermediate degree move is stretching it so moving everything up by one degree is an option. In other words, we could be in a Primary degree “B” move that is just another big bear market rally.

At a minimum, another correction is due which could send gold back down to the $1260 price level. The $1260 price range would only be a small correction but if a much bigger corrective move is coming then the $1260 price level doesn’t have a chance of holding.

Any gold run below $1160 would confirm that the 5 waves just completing was just part of another fancy bear market rally.

I personally would not be caught dead being long in gold when a vertical move is completing, but the rest of the world is super bullish in gold.

To show how bullish they are I took a screen clip of all the gold contracts going out to December 2024 where gold was already pushing $1511. Any bear attack will certainly change all the above contracts, and with a $100 spread the wave patterns that far out, are radically different.

Sure gold has had a nice run but big bear market rallies can fool us all the time. Gold bulls are smiling as they see this breakout as the beginning, not the end!  Since 2011 gold has had many false bullish moves so what’s the difference this time?

It’s all about the fundamental news but yet nobody can remember these fundamentals a few months later. At least with wave positions, we have a much bigger and longer time horizon.  All the wave counting in the world matters little if we have no clue what degree level that the 2011 peak is.

My gold wave counts need more time until the public lays all its fears on the front pages.

I had a bet going that gold would not see $1400 or higher and yet it did just that, last night. 10 ounces of silver was on the line so I must deliver the 10-ounce silver coin today!

 

Hits: 13

Gold Daily Chart: Bull Market Or Bear Market Rally?

Since the August 2018 bottom has now charged up getting very close to the $1400 price level.  By the end of the day, gold may breach the $1400 price level.

I have a horizontal line at the $1375 price level which I see as being very special.  The main reason why $1375 is special because it’s a 1.618 ratio from the 1980 gold peak of $850.

The majority of gold bugs are jumping for joy as gold is finally breaking out!

The problem with any bullish run is that when a small majority thinks it’s a bull market break-out it can also be the end of a bigger bear market rally.

The commercial hedgers don’t see a bull market as they have a large net short positions in gold at this time.  If the majority are just waking up to the present bullish phase, they are pretty late already.  A bullish vertical move is never a sign to jump in because they always run out of steam most of the time.

Many believe that the 2011 peak was some ordinary peak so they are just looking for a gold market correction.  2011 is my wave 3 in Cycle degree and I have not been forced to change it just yet!  There is no way that a Cycle degree correction has already completed, so gold could turn south with little effort.

Hits: 16

Gold Intraday Chart And Impending Death Cross!

My last gold post got 323 page views within the first 24 hours after being posted, which has broken many records that have only been beaten  3-4 times before.

At this time the intraday chart moving averages show a potential death cross can happen if gold’s recent spike is a bigger event than expected.

Crossings happen more frequently at this intraday scale but it will take more time for gold to show us a new direction.

In order for the death cross to happen the gold price needs to crash a bit further but knowledge about any crossings is pretty useless if we don’t understand the “Lag Time” involved.

The small Minuette degree wave 2 may already be completed so hopefully gold will confirm it very soon.

Hits: 9

Gold Weekly Chart Review

For the last 3 1/2 years, gold has been in a sideways pattern and is now approaching the upper part of this range, $1360-$1375.  At $1400 gold’s breakout would be pretty obvious and I’m sure the gold bulls will be cheering.

This weekly chart 2019 death cross,  has been avoided for now but I’m sure that the death cross will happen.

At $1050 or lower gold would confirm that for the last 3-4 years, the gold price has just been in a big bear market rally.

Trying to hunt for an Intermediate degree wave 3-4 is now over 3 years old and compared to other Intermediate degree corrections since 2011, this is getting a bit too long.

Jumping up by one degree definitely cures the time problem but we still have a location problem. Gold is acting this bullish but silver is still far behind. If the surge in the gold price is fear based, then the gold bulls could get worn out and run and hide.

Many may think that the $1050 price level is some miracle support price but nobody knows what that 2016 bottom really is. When the 2011 peak hit I think it was a Cycle degree top and frankly there is little chance that a Cycle degree 4th wave has already completed at this point in time.

At a minimum gold would have to dip into the 1980 price peak of $850 before any major new bull market will occur. All commodities run under diagonal idealized patterns, which means there are always many zigzags that connect together. With gold, the 5 waves ending in 2011 was a Primary degree “C” wave run.

With the impending bottom of solar cycle 24, anything can still happen to the gold price.

Hits: 32

Gold Bullish Phase Impending Correction

For the last month or so cash gold produced about 7 wild spikes to the upside, which readers can all ignore. Anomalies like this do happen in futures forcing me to double check by the switch to line mode to see if the spike is real.

As wild as this bullish phase has been it’s pretty normal for diagonal wave structures. The 5th wave is another zigzag with one 5th wave being part of a “C” wave bullish phase.

The May/June zigzag is not even close to having an even “C” wave but I look for zigzags anyways. I allow much more extreme zigzag lengths like in 1930-1932 stock market decline. When a market dishes out a long “C” wave then I allow it and incorporate it into my version of the EWP.

The Gold price can crash again as this potential 4th wave correction has not finished.

Hits: 7

Gold Daily Chart: Time For A Correction?

Gold started out June with a price jump that can get the gold bulls all excited. Ok, I’ll bite as the last 3 months sure can work as a diagonal 4th wave flat.

The H&S could also be very bullish but before this happens, gold may have to crash back down to $1260-$1250, and then crank back up again.

On the other hand, gold can fall like a rock but then we know that the gold bulls are not as committed as the media makes them out to be.

Gold moves that are made with “Fear” hardly ever last that long so we still could see some wild action in both directions.

The one thing that some people might not expect is that a diagonal 4th wave can dip down into wave 2 which would be closer to $1200 gold.

 

Hits: 17

Gold Intraday Wild Ride To The Stars!

Since the last part of April and all of May gold showed 3 higher lows before soaring to $1318. I think a correction is due but this could also be another false start to nowhere after which gold can crash very deep.

This has happened so many times that I care to count, but I also know these wild and choppy moves are part of what makes commodities rather exciting at times.

Of course, if you missed this run then welcome to the club. All the spikes you see you can ignore them, except our present spike, which is the real deal! This blast is part of a “C” wave which if I’m right, will get completely retraced.

These wild moves also change the Gold/Oil ratio but the ratio has remained close to 24:1.

Hits: 16

Gold Daily Chart: Fear Moves Don’t Last!

So far gold is doing what I wanted to see happen, but it’s so choppy that it can be part of a diagonal decline and never breakout or see $1350.  Gold looks like it’s in a correction but I also have to keep my diagonal options open.

A little crash in the USD sure helps to fire up the emotional investors as they charge into gold. When you hear investors running to gold as a safe haven hiding spot, then this is an emotional decision and not a logic longer-term investment.

At this daily chart scale, gold has not bounced off the 200-day MA, which will be important to watch.

I have made some changes to the wave count and we will see if a new bearish low happens.

It also depends on how bullish or how bearish the commercial hedger’s COT reports are tonight.

I’m sure President Trump’s duties slapped on Mexico was a surprise, but really folks what do you expect in a trade war. In 1930 the trade war had the same effect when they signed the Smoot-Hawley Tariff Act.

Small tariff wars have never really stopped as many presidents also loved to enforce duties.

Hits: 7

Gold Daily Chart: Impending Breakout?

For the last 3 months gold has been declining but the waves have been overlapping to a point where we can be in a triangle with the “E” wave still to complete.

Last week the commercials in gold and silver made some bullish moves as they added longs and took away short positions.  Gold doesn’t have to fall to $ 1260 as it could just blast up from today’s prices as well.

If a bullish move is still pending then that right shoulder trend line should not hold.  Any price move above $1350 would be a good sign If we are in a corrective pattern and we get a 5th wave. It could be as long as wave three by the time this rally is finished.

We still have a full week of trading for May but then June could produce another reversal.

 

Hits: 23

Gold Intraday Review: Correction or Return of the Golden Bear?

Gold has made some wild moves since its peak on February, 20 at the $1346 price level. I also dropped the degree level down by one degree which might not last too long as I do have the potential for a triangle to play out as well.

Commercials are still net short by a large amount and last week they added to their bearish outlook when they removed longs and added short positions at the same time.

What I’m looking for is a zigzag type of a move which should take us to new bearish lows. If that happens then my mythical triangle may also become more visible, which suggests a new record high can happen.

You can ignore that huge spike to the upside, as it only shows up in a bar style setting but it doesn’t show up when I switch to line type settings.  False spikes do happen and since the April peak, several other false spikes were also created, which I didn’t count.

The worst that happens with a spike is that your account provider scopes in a huge amount of stop-loss orders from the bears.

It used to happen to me when I was trading the mini gold contract as the liquidity was extremely low and spikes were pretty normal.

I know that the gold bulls are looking for investors to charge into gold as a safe-haven but those are emotional decisions which never last that long.

Gold has been in a bearish mood since the 2011 peak and unless you know how bullish they were at that peak we can make the wrong decisions thinking a standard  5 wave bull market has happened.

That 2011 peak was a 30-year ± 1 year mania peak as wave 3 in Cycle degree. Not only that but gold also finished a huge Primary degree zigzag at the same time.

All commodities run under an idealized diagonal world that has been active since the Little Ice Age. That all changed during the Roaring 20s as stocks and commodities separated and went their separate paths.

 

Hits: 7

Gold Intraday Gyrations Update

The US dollar plunged this morning and gold reacted with its own small spike to the upside.  Is gold in a small 5 wave sequence? If it is, then gold could cut right through the top trend line next week.

This is a diagonal wave count  I’m working at this time and it can spike back to $1310 before I have to call my bearish outlook in gold as dead. Maybe not really dead, but just postponed for now.

Hits: 6

Gold Monthly Chart 1980-2019 Elliott Wave Count Review

It’s always a good idea to go back in chart history to do a complete review. All my Supercycle and Grand Supercycle wave counts I used to have no longer were making sense, so my degree levels eventually ended up at a Cycle degree.

Three-degree levels above and three-degree levels below Cycle degree is what I’m chasing.  All the Minor degree wave positions have not been filled out. They will not make any senses anyway if any Intermediate and Primary degree positions don’t make sense.

Basically, what it means we have to connect all the “Cycle Degree Dots” first before we can ever advance into the next higher degree.

I generally don’t like to use trend lines very often as I think they are very subjective.  The bottom trend line is based on the angle of the top trend line. The bottom trend line is pointing to the $500 price range.

Just so gold investors don’t freak out thinking I’m forecasting $500 gold, you can look ahead with the top trend line and it could be pointing to $3000 gold.

The top gold wave count ended on a very good 5 wave impulse move, blowing its top in 1980 at $850. Every wave analyst on the planet had some degree of a wave 3 top for 1980.  Even before I fully realized that commodities run as giant diagonals I started to apply it to gold.

From 1980 to the 2011 peak all we had was a zigzag. A fricken zigzag lasting 31 years and still only a Primary degree move. A bear market in gold lasting about 20 years was the result of the 1980 gold mania peak.

If we jump to the 1999-2000 gold bottom, gold was considered junk as it seemed that the entire world was trying to dump gold. Then a miracle happened and gold started to rally and never stopped for a good 10-year run.

I use the 30-year cycles in gold from 1920, 1950, 1980, 2011 with 2041 being the next 30-year cycle top. (SC Wave 3)

In late 2011, the gold price started to tumble and most of the wave analysts were looking for the bull market to come back. All the wave counting in the world will not help us if we have no clue what the 2011 peak really was.

It was another gold mania even more insane than 1980,  as $5,000-$10,000 gold forecasts were pretty normal.  Back at the 1980 peak, the gold price forecasts were $2000 or more. The only thing that has changed is the price of the forecasts.

If you believe that the 2011 peak is a wave 3 peak in Cycle degree,  then we can pick out 3 types of corrections that we can have. It’s pretty common Elliott Wave knowledge, that markets can fall back to the previous 4th wave of one lesser degree. The 1980-2000 bear market is not the 4th wave! It’s a “B” wave but they can act much like a 4th wave as well.

I think our present gold market is still in a bearish funk, but it could take a few years for us to see a better picture. The decline of solar cycle 24 is drawing gold prices like a magnet, but gold prices could also get repelled back up with the power of solar cycle 25 behind it. Sure we’ve had a long bearish phase already but history shows us that longer ones can happen.

 

Have a Great Easter!

 

 

Hits: 69

Gold Daily Chart Bearish Update!

Looking at gold from a daily chart perspective can give us an alternate opinion, especially if we are looking at a potential Head&Shoulder pattern.  I just labeled the “Head” while the right shoulder is still declining.

If this picture in gold is really a bullish pattern then, the right shoulder would have to blast much higher and not stop!  Of course, if the 5 wave sequence is close to reality then this decline will keep right on going taking out the $1160 price level.

Gold has a track record of crashing $$180-$200 in any bullish or bearish situation so any price below $1150 would certainly qualify.

The 200-day MA is down at the $1250 price level, but gold would have to travel much further before the death cross on this daily chart happens.

The death cross is much closer in the weekly and monthly charts than it is on this daily chart.

The commercial hedgers are in a very bearish funk as this is a strong net short position. With these numbers, it’s pretty hard for gold to soar to the moon again.  This Friday is a full moon so short term, gold could turn bullish.

When gold soars due to safe-haven buying,  then these moves never last very long as it’s all based on the emotion of “Fear”.

Silver and gold can and do move together, but they do so under different patterns.  In short, the overall bullish pattern in gold is painting us a false scenario, which silver and gold stock ETFs do not confirm.  Just because an asset class goes up does not mean it’s in a real bull market. Bear market rallies can last for years before they implode again.

Hits: 3

Gold Intraday Update

Once I looked at the commercial hedger’s positions, there was no doubt in my mind that they are in a bearish mood.

I will add the gold COT report later. They were also just as bearish in silver so I can’t see gold or silver soaring to new record highs just yet. Most of these metals or futures contracts have no daily limit and gold/silver are two more. It is also one of the main reasons why these no limit contracts can free fall.

The death cross on the weekly charts is below us at the $1250 price level, and the $1160 price level will confirm this wild gold move mostly as a bear market rally.

Commercial hedgers removed 25,503 long positions and also added 10,272 to their short side. Combine them together and that is a substantial bearish move. Chasing a bullish wave count under these conditions is futile at best.

 

Hits: 5

Gold Intraday Gyrations Update.

You can blame gold’s gyrations on Turkey, if you like.  It sure seemed like the US dollar and the Euro benefited from the lira turmoil.

We did have a bullish phase in March, with only a few days left to go. Watch out for fake April Fool’s news, as the pranksters just love putting out fake news.

Today the media is easily manipulated, more than it ever has in history, and it’s only going to get worse.

The March rally started as a good impulse, but then it fell apart after the “A” wave peak in Subminuette degree. Gold is sitting on the bottom trend line and if the Golden Bears are in control, then this bullish support line will never hold.

If gold slices through the psychological $1300 price level with ease, then that would also help make my bearish case.  $1294 might give us 50%-60% retracement support, then again a very bearish gold price will not care about any support.

Where is the death cross?  I looked at the daily chart and then switched to the weekly chart and at about the $1240 price level gold would have to find support at the 200-day MA line. Even the golden crossings happened at about the same price level, so it will be very interesting when it gets closer. The 200-day MA is only $50-$60 below us and a crash this small is a walk in the park for gold.

 

Hits: 6

Gold Daily Chart Update

I’ve made some adjustments to the wave count at this time.  The big question is, “Is this rally a Bear Rally”?  I like to think it is but only time can answer that question.  A Gold crash below $1160 would give us an answer.

First gold has to show us what the $1200 price level will do, as even numbers seemed to be a crowd psychology thing.  Crossing the $1200 price level could get the gold bulls very worried and a new rush of protective sell stops could get triggered.

At the $1350 price level another right shoulder will form and if there still is a big bullish gold price move, then the right shoulder will not hold.  In the last few years, we’ve had a few H&S patterns and they all have pushed gold prices back down.  Last week commercials made some bullish moves but they are still net short by a wide margin.

In little over 5 months, gold moved up $175, but they are forgetting that gold has an ugly history of crashing $100-$200 as well.

If investors are running to gold for a safe-haven to hide in, then that’s an emotional move, not a logical move.

Gold has also come to a screeching halt as it bounces around the 50-day MA line. Gold is still under the influence of a golden cross and gold would have to crash through the $1240 price level for us to witness a new death cross.

On a weekly chart, the new death cross is only about $20 apart!

 

Hits: 13

Gold: Weekly Chart Impending Death Cross Review

I look at two sets of COT reports and this chart shows that the commercial hedgers have a very bearish outlook. Of course, the speculators are doing the exact opposite as they are chasing the gold bull market that many believe we are in.   When I see such a bearish position as the COT report above I’m not going to spend my time looking for a bull market, that may never come.

Between the silver chart and this gold weekly chart, we can see a huge difference.  Since the 2016 July, peak gold has a very bullish slant so wave analysts will show a bullish wave count, most of the time.  Silver and the majority of gold stock related ETFs do not confirm gold’s pattern as most of them are pointing down, not up like gold.

At present we have 3 major gold prices that if cross will make or break another bull gold market myth.  $1160, $1120 and $1050 will all be critical price levels, besides $1200 being a psychological number as well.  For now, gold is still under the control of a Golden Cross but will be set to change if gold keeps crashing.

With a monthly chart, the 200-day MA is down at the $1000 price level, while on a daily chart the 200-day MA is at $1240.

No wave count is written in stone but when the bullish leg that started in August 2018 retraces about $96 we could be ready for a reversal. We could get a 60-70% retracement as well but we better see a stunning correction like pattern when it completes.

Any price below that $1160 bottom will confirm that at least one leg of it was just a bear market rally.  Bullish and bearish moves can last for an entire month with March being a very popular turning month. It’s a seasonal thing as well, as people become more active in March when we start to get out of the deep freeze we’ve had this year.

Hits: 40

Gold Weekly Chart Review

Bull market or bear rally is the million dollar question?  What the majority do call a bull market, can be just a big bear market rally from an EWP point of view.  Since the 2011 peak we’ve had more bear rallies than we can count, well we can count them if we have nothing better to do. Many were Minor degree moves with one Intermediate degree bull move that all have failed.

I was fooled as well but slowly succumbed to the bears as counter rallies were always completely retraced.  Sure, at times the price is important but the pattern is far more important. If we look back to the 2015 low ($1050), gold has been in a bullish phase since then and is now a little over 3 years long in duration.  Since the 2015 bottom, we’ve had two higher lows which is a conventional way of calling a bull market.

Each of the three bullish phases topped out and was followed by a crash and recovery. We ended up with three peaks that have to produce some serious resistance, with the third peak reaching $1346 before gold started to correct again.  We would need this gold run to continue past the $1400 price, and once that happens you will hear the world screaming, “Upside Breakout”.

Since the 2016 top, we now have two sets of Head&Shoulder patterns already formed. Are they bullish H&S patterns or bearish patterns? We also have a wedge that has formed, so any new direction is not all that clear at this time. Gold has 3 major support prices that would have to hold if a true bullish phase is still in progress, but if gold has been in a 3-year bear rally, then all three price supports will get completely retraced. The three support prices would be $1160, $1120 and the last one would be $1050?

Gold has also been in a rally right along with stocks, so gold could also crash right along with the stock markets. When fear strikes logic thinking is thrown out the window and all those little emotional “Algorithms” will panic, selling out before bullish investors lose money.  Sell stops are piled up below present prices, and you don’t need a smart “Algorithm” to trigger them.

AI trading is also becoming a major factor and I see it more of a bad thing than a good thing.

I would be far more bullish if the commercial traders were in a net long position, but the sad fact is that they are not!

 

 

Hits: 25

Gold Intraday Bearish Update

In February gold has slipped back into a bearish mood now approaching the $1300 price level. $1300 is what I call a psychological price as the media picks up its commentary when this price level is getting close.  The other psychological price level is $1200. The gold analysts will go nuts if gold ever approaches $1200 again.  The question remains? Is gold in a bigger bullish phase, or was the move from $1160 just a big bear market rally?   Since the 2011 peak gold has made many bear market rallies where the majority were fooled into believing the return of the bull market.

I’m keeping my degree levels small at this time as small degree levels get trashed pretty quick, as it’s all about the process of elimination.

I would turn very bullish on gold if gold produced a big impressive spike to the downside, but gold must also display a huge zigzag or even a flat type of a crash.  It’s the end of “C” waves that do produce the huge spikes.

It looks like a nice run of 5 is starting so now its just a matter of time if another run of 5 completes. Sounds like playing cards when I talk about a run of 5, and it is. I used to play Big Bertha a lot where we always need to build runs. Even corrective waves come in runs of 5, like W, X, Y, X, Z.

Any drop in the gold price,  say from $1300 to $1200 is just, “Childs-play”, as gold can move very violently when it wants to. I also read that January gold runs don’t last all that long and even summers can be pretty boring for gold. When gold makes a run out of fear, “Safe-haven buyers rushing in”, then they can “Rush out” just as fast.

We are close to a 7-year bear market in gold so far, and I think it’s far from over. I’ve counted out 13-year bearish moves in silver several times, but that doesn’t mean it will happen this time.

Hits: 15

Gold Intraday Peak Update!

Last month gold has finally decided to back off in its price surge to $1325. If this so-called bull market in gold is real then a strong correction has to complete well before the $1160 price bottom. That’s a lot of price distance gold has to cover, which the majority of participants don’t expect. Banks are up to their usual tricks and have been buying gold in 2018.  The problem with banks buying and selling gold is they always buy high and then sell low at bear market bottoms. Back in 1998-2000, they were selling gold as fast as they could with countries unloading their gold stashes as well. In 1999 gold was considered an ancient relic, close to junk status.

As fast and far that gold can soar, it can crash even faster and deeper. We could see a correction, but don’t get excited as even a zigzag decline can crash to new lows if this bullish phase is just a big bear rally. Fear could engulf many asset classes where there is no place to hide as stock markets and gold crash at the same time.  Sure, I can be wrong and it will be important to recognize a correction when it’s going to finish.

I believe the 2011 peak was a 30-year mania peak in Cycle degree wave 3. Any Cycle degree bear market in gold does not end in just 8 or 10 years, as the bear market in gold during the 1990’s last 20 years.

Since the government shutdown, the first COT report was published last Friday. The way things are going the government could shut down again, with no COT reports being produced.

When I first saw the report I noticed a very large shift to the bearish side, with about 5-6 weeks backlogged data being published.

 

Commercials added 33,486 short positions and took away 2058 long positions, for a combined total of 35,544 contracts totaling just over 3.5 million Troy ounces.  Now, look over to the NON-Commercial side (Speculators).  We can see they did the exact opposite, chasing this gold bullish phase.  The problem is that both parties can’t be right!  The mass media always talk about what the speculators are doing and ignore all commercial hedgers action. From my perspective, the commercial hedgers have the best track record and ignoring them usually brings pain and suffering onto the bulls that think a trend can never end. What the COT report is telling me is that no super gold bull will start to soar anytime soon.

There is no corrective price bottom I want to use right now, as a 60%-70% net crash can happen. The $1200 price level is a gold psychological price level so if and when the gold price ever hits that area again it could put up a big fight!

Silver has a lot less distance to fall before it resumes the big bear market again.  Silver only has to fall below $14 and then below $13.50 and it would be back into its bear market.

Hits: 6