After the <b>Gold Prices</b> Dramatic Reversal Yesterday it Gained Another |
- After the <b>Gold Prices</b> Dramatic Reversal Yesterday it Gained Another
- Is the <b>gold price</b> heading lower in the <b>charts</b>? - MoneyWeek
- How Oversold Can <b>Gold Price</b> Get? :: The Market Oracle :: Financial <b>...</b>
| After the <b>Gold Prices</b> Dramatic Reversal Yesterday it Gained Another Posted: 25 Apr 2014 03:55 PM PDT Gold Price Close Today : 1,300.70 Gold Price Close 17-Apr-14 : 1,293.40 Change : 7.30 or 0.6% Silver Price Close Today : 19.691 Gold Silver Ratio Today : 66.056 Silver Gold Ratio : 0.01514 Dow in Gold Dollars : $ 260.03 Dow in Gold Ounces : 12.579 Dow in Silver Ounces : 830.91 Dow Industrial : 16,361.46 S&P 500 : 1,863.40 US Dollar Index : 79.830 Platinum Price Close Today : 1,422.80 Palladium Price Close Today : 811.45 Over the last week silver and GOLD PRICE moved barely up, while stocks moved down, but the closing numbers don't quite tell the whole story. After yesterday's dramatic reversals gold gained another $10.20 to end at $1,300.70, barely above the 200 DMA ($1,300.31). Silver gained only 3/10 cent to close Comex at 1969.1. Well, it ain't much, but it's a higher close, so both the silver and GOLD PRICE confirmed their key reversals yesterday. On its monthly and weekly charts gold has broken out upside through its intermediate term downtrend, but sill must conquer the downtrend line from 2011. On the daily chart gold yesterday spiked through its 100 day moving average to $1,268.40, then immediately reversed to close the day higher, and closed today higher as well. The SILVER PRICE reversal yesterday with a spike to 1893c was even starker, but today's tiny gain left silver mumbling out of both sides of its mouth. It ran today smack up against its downtrend line and the 20 DMA (1978c). Silver and gold have both fulfilled their downside correction targets and smartly re-bounded. For all its lagging, silver did revisit its downtrend line from April 2013, the line it punched up through in February. That also points to a completed correction. Silver has broken to the upside on the weekly chart, but not yet on the monthly, though it's close. I'll try to draw the conclusion in a few words: buy silver and gold. Now. While the world verges on war in Ukraine, the US dollar index and gold don't seem to care much, but stocks appear uneasy. O strange old world! The US dollar index seems to have flunked the test this week at its coincident 20 and 50 day moving averages (both at 80.02). It reached up there twice, then flaked and fell back below 80. Fell today 5 basis points (0.06%) to 79.83. What might have been a double bottom March and April with the last at 79.39 appears not to have been. Expect the dollar to drop yet more. Despite the dollar's woes, the euro has remained in an overall downtrend since March. Yes, tis above its 20 DMA ($1.3800) and 50 DMA ($1.3796, but showing little perkiness or appetite to climb mountains. Nor does the yen long to move higher. It closed today up 0.16% at 97.90, but still within its slightly declining three month range. Ten year treasury yield fell today, 0.82% to 2.666% and fell for the week, back to its bottom channel line. Not much life. Copper has bounced back from its brush with death at $2.877. Although it has climbed smartly since mid-March, today's close at $3.12 remains below the downtrend line at $3.15. A close clean above $3.32 will finally confirm copper has no intent of dropping further. Which is copper, a prognosticator for stocks or harbinger for commodities? I lean to the latter as what concerns us more here. Copper is probably the last of the metals to turn up. Dow nervously dropped 140.19 (0.85%) today to 16,361.46, enough to turn it down 0.3% for the week. S&P500 dropped 15.21 (0.81%) to 1,863.40, barely lower for the week. Stock charts are singing a dirge. Nasdaq Comp shows what appears to be a 5-month head and shoulders, S&P might be showing the same but definitely is in a month-long downtrend. Dow has the best chart, and it looks like a big double top. Everything is set up for a final high in May. Dow in silver dropped a tad today, 0.2% to close the week at 838.03 (S$1,083.51 silver dollars). Appears to have topped, but needs to confirm still. Dow in Gold fell 0.78% to 12.69 oz (G$252.33 gold dollars). More confirmation needed to declare it reversed downward. Y'all enjoy your weekend! - Franklin Sanders, The Moneychanger © 2014, The Moneychanger. May not be republished in any form, including electronically, without our express permission. To avoid confusion, please remember that the comments above have a very short time horizon. Always invest with the primary trend. Gold's primary trend is up, targeting at least $3,130.00; silver's primary is up targeting 16:1 gold/silver ratio or $195.66; stocks' primary trend is down, targeting Dow under 2,900 and worth only one ounce of gold or 18 ounces of silver. or 18 ounces of silver. US $ and US$-denominated assets, primary trend down; real estate bubble has burst, primary trend down. WARNING AND DISCLAIMER. Be advised and warned: Do NOT use these commentaries to trade futures contracts. I don't intend them for that or write them with that short term trading outlook. I write them for long-term investors in physical metals. Take them as entertainment, but not as a timing service for futures. NOR do I recommend investing in gold or silver Exchange Trade Funds (ETFs). Those are NOT physical metal and I fear one day one or another may go up in smoke. Unless you can breathe smoke, stay away. Call me paranoid, but the surviving rabbit is wary of traps. NOR do I recommend trading futures options or other leveraged paper gold and silver products. These are not for the inexperienced. NOR do I recommend buying gold and silver on margin or with debt. What DO I recommend? Physical gold and silver coins and bars in your own hands. One final warning: NEVER insert a 747 Jumbo Jet up your nose.  |
| Is the <b>gold price</b> heading lower in the <b>charts</b>? - MoneyWeek Posted: 23 Apr 2014 05:10 AM PDT Last Wednesday, I covered the gold market. I explained how I managed to take a good profit out of my latest counter-trend long trade and was standing aside while I let the dust settle following the sharp break on 15 April. This was the chart last time: Since the wave 3 low last summer, the market has been in a large consolidation zone described by the lines of my triangle. This is the wave 4 of the pattern. Typically, fourth waves are complex and can give the active trader nightmares as the market whips one way and then the other. If you are trading breakouts, then it is common to be whipsawed to death. This is the most dangerous wave to swing trade! But there are ways to intelligently trade these minor swings, because with the knowledge that fourth waves usually contain several A-B-Cs both up and down, we are prepared.  Don't use logic to make a tradeMy best guess last time was that shown in the chart above: first a decline to create an A-B-C off the $1,390 high and then another big rally to perhaps challenge the $1,400 level again. Recall that the last assault was stopped a few dollars short of that much-touted target. Many bullish hearts were broken on that miss. So let's see if my best guess has been working out over the Easter break. Here is the hourly chart: Note that when I drew in my best guess on the first chart, I knew nothing of the political tensions that could arise from the simmering Ukraine situation. In the meantime, there have been fatal shootings at the Ukraine border and an escalation of the intensity of US warnings to Russia. This introduces the prospect of retaliation by Russia to possibly endanger gas supplies to the West. Under this scenario, logic suggests that gold and crude oil would be expected to rally. Instead, they have fallen. Just yesterday, crude fell by a whopping $2. Any trader using the news – and logic – as a basis for trading would be suffering losses.
MONEYWEEK TRADERClaim your FREE report: The five-step game-plan for The one thing every trader should doIf I could encourage all traders to do just one thing, it is this: stop trading off the news! This is a stark illustration of why I rarely use the news (or 'fundamentals') for making trading decisions. It is the action of the other traders that I watch like a hawk – not the news.  Basically, it is not my interpretation of the news that matters – it is my reading of how the other traders react to the news that is important. This means that I have a large weight removed from my shoulders: I don't need to avidly follow the screeds of news articles on my markets. The fact that gold and crude have been falling in the face of increased global tensions tells me that the markets are being driven by something stronger – and there is no outside influence that can stop that trend. This is the whole basis behind the wave principle – the observation that market prices are patterned into waves that can be anticipated in advance, if skilled enough. The market follows my scriptOK, back to the above chart. I have drawn in the best tramlines I could find. They are not textbook. The upper line has a PPP (prior pivot point) but only one touch point. The lower line is better as it has three accurate touch points and a pigtail cut-off. This places the line in the satisfactory category. Since last Wednesday, the market has fallen below the lower tramline and is following my script perfectly. Let's see this in close-up on the hourly: From the mid-March high, I have my A and B waves in place and the market currently is forming the final C wave. The big question is this: where will C terminate and reverse? If I can locate that point, I can cover my shorts and trade from the long side again. Remember last time I noted that the big plunge from the B wave high to my lower tramline must have been a shock to the bulls' confidence. From that B wave high, the moves down have been sharp and swift, while the rallies have been weak. Note that this behaviour is in sharp contrast to that exhibited in the B wave up, where rallies were sharp and dips were generally weak. This is another clue that the path of least resistance is down and that we likely have further to go before my C wave turns. Reading the character of the market is a useful skill to develop. What the markets are doing todayThis morning, the market appears to be heading below the A wave low at $1,280. It made a textbook kiss on the lower tramline with a small scalded-cat bounce yesterday. There is one more interesting chart pattern that formed yesterday: I have a downtrend line drawn which sports a nice PPP. The market rallied to the intersection of this line with the major up-sloping tramline. Where two tramlines intersect, I call that a Chinese hat. This is where resistance is augmented, since both lines are lines of resistance. Isn't that pretty? • If you're a new reader, or need a reminder about some of the methods I refer to in my trades, then do have a look at my introductory videos:• The essentials of tramline trading • Don't miss my next trading insight. To receive all my spread betting blog posts by email, as soon as I've written them, just sign up here . If you have any queries regarding MoneyWeek Trader, please contact us here. • Stay up to date with MoneyWeek: Follow us on Twitter, Facebook and Google+ |
| How Oversold Can <b>Gold Price</b> Get? :: The Market Oracle :: Financial <b>...</b> Posted: 25 Apr 2014 03:29 AM PDT By: Alasdair_Macleod Gold is now extremely oversold, with emotional opinion in paper markets unanimously bearish. Traders tell us the 200-day moving average is well and truly broken and the next support level is $1260. However, when gold broke down through the $1280 level yesterday it rallied sharply to test the $1300 level in a one-day spike reversal. Market chat and technical analysis are one thing; more important are the motives behind the commentary, revealed by a dispassionate look at Comex figures. And here we see that Producers and Merchants short positions have fallen to an eight-year low at 73,033 contracts, against a long term average of 186,400. This is the primary source of liquidity for all futures markets, and it has simply dried up. Swap dealers have also cut their shorts dramatically, reducing their net position by 26,582 contracts, and the eight largest traders between them have a level book. In short, the bears have to persuade us to sell, or they will be in trouble. The figures quoted above are as of 15th April. Since then the gold price confirms this analysis by refusing to go lower and stay there (hence yesterday's spike reversal), while open interest has risen from the post-Lehman crisis low on 4 April. This is shown in the chart below. The rise in open interest tells us that the shorts, mostly hedge funds, are opening new positions and failing to drive prices lower, so the market is being set up for another bear squeeze. By way of confirmation the gold forward rate in London remains negative up to three months out, indicating an extreme shortage of physical metal at these prices. In these markets sentiment can change very rapidly. We read this week that the US is on the brink of another housing crisis because sales (demand) have stalled. Last weekend the Ukrainian protagonists met in Geneva and agreed to "de-escalate" the situation. By Monday the situation was escalating again. Oh, and the best contrary indicator of the lot was also on Monday, when according to the Wall Street Journal's Market Watch blog, for the first time ever all 72 economists polled by the National Association for Business Economics expect the US economy to grow this year. It is usually right to bet against such unanimity in economists. Monday. US: Pending Home Sales. Tuesday. Eurozone: M3 Money Supply, Business Climate Index, Consumer Sentiment, Economic Sentiment. UK: GDP (first est.), Index of Services. US: S&P Case-Shiller Home Price Index, Consumer Confidence, FOMC Meeting (to Wednesday). Japan: Industrial Production. Wednesday. Japan: Construction Orders, Housing Starts, BoJ Monetary Policy Meeting, BoJ MPC Overnight Rate. Eurozone: Flash HICP. US: ADP Employment Survey, Core PCE Price Index, Employment Index, GDP Annualised, GDP Price Index, Chicago PMI, FOMC Fed Funds Rate. Thursday. Japan: Vehicle Sales, Real Household Spending, Unemployment. UK: Nationwide House Prices, BoE Mortgage Approvals, Net Consumer Credit, Secured Lending, M4 Money Supply. US: Initial Claims, Core PCE Proce Index, Personal income, Personal Spending, Manufacturing PMI, Construction Spending, ISM Manufacturing. Friday. Eurozone: Manufacturing PMI, Unemployment. US: Non-Farm Payrolls, Private Payrolls, Unemployment, Factory Orders. Alasdair Macleod Head of research, GoldMoney Alasdair.Macleod@GoldMoney.com Alasdair Macleod runs FinanceAndEconomics.org, a website dedicated to sound money and demystifying finance and economics. Alasdair has a background as a stockbroker, banker and economist. He is also a contributor to GoldMoney - The best way to buy gold online. © 2014 Copyright Alasdair Macleod - All Rights Reserved © 2005-2014 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication. |
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