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Gold Still In Bear Cycle?

GOLD- Well, not a merry Christmas for Gold buyers just yet. We have said in our TMTF forecast service to watch 1190 as KEY support and 1241 would also need to be taken out on a closing basis before we could confirm a new uptrend in Gold and the end to the 5 wave bear cycle. Not quite yet, and in fact in my stock service we have avoided Gold stocks entirely even with the recent temptations to get long because Gold to us is key. If we are not over 1241 then we are not buyers of Gold equities, plain and simple. With 5000 stocks to choose from, why not stick with the sectors that are in the stronger uptrends and avoid those mired in the mud like Gold? For example you could be looking at Security stocks given all the cyber attacks worldwide that are only getting worse. Gold is money as we all know, but a downtrend is a downtrend. Trust what you see, not what you think for best results.

So right now the problem is we just gave up the 1190 support and the 30 week MA line on the weekly chart is your guide for key resistance to take out. We remain in the sidelines until its taken out. The chart below shows the blue line with the 30 week Moving average resistance, and you can use this same chart for the uptrend in the SP 500 which we have used recently for our subscribers as well. Don’t suffer from history bias and the hay days of Gold stocks and Gold, which ended in 2011…wait for the next Hay days to arrive, watch the 30 week moving average line before acting.

tmtf gold 1223

The SP 500 meanwhile is in wave 3 up from 1973 38% shallow wave 2 lows. That was a quick correction and the waves now are likely to be faster and shorter as we are in Primary wave 5 of this bull cycle, the last stages of the Bull if I’m right. 2131-2138 is your bogey ahead for first Fibonacci pivot resistance on the way to the 2181 target I had out over a month or so ago.

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8/14- Updates on Gold and SP 500

Both charts on the SP 500 and GOLD remain bullish.

It appears that GOLD is forming a rare Stage One base pattern while at the same time forming a Bullish Triangle.  This means a large move is coming very soon, we expect to the upside… but for sure this Precious Metals market has lulled everyone to sleep… may need to wake up soon.

The SP 500 remains above the 20 week MA line on weekly charts, noting it’s the key line in the sand for Primary wave 3.  Our target remains 2213, the same figure we put out over a year ago

tmtf sp 500 814 814 tmtf gold

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Gold topping out for a bit?

David Banister- www.MarketTrendForecast.com

Back in late June I penned a piece and wrote about GOLD bottoming in its bear market cycle at the 61% Fibonacci pivot around 1181 spot pricing. That has so far been working out, and as I said “they just rang a

bell at the bottom”. Well, now we need to get updated some 8 weeks later after this massive Gold rally which has put Gold in a technically overbought condition. Recently at my forecast service I discussed 1415 as a key line in the sand for the GOLD rally, to see if it could take that Fibonacci level out off the 1179 spot lows. It did briefly, hitting 1434 which is where roughly the A wave equals the C wave from the 1179 lows. Anytime you see what looks like a clear cut A B C pattern after a big decline, a few warning bells should go off for a short to intermediate term top. The warning signals we see are numerous, so they are worth noting: 1. The rally to the 34 week moving average line abruptly halted just $3 short of it and reversed hard to the downside.

2. We surmised that

this last stretch of Gold Trading over 1415 was probably Syrian concerned based mostly.

3. Gold has since dropped in a few days to 1371 spot lows (Labor Day low volume overnight lows, but still…)

4. The entire rally still has characteristics of a potential ABC Wave 4 correcting so far just under 38% Fibonacci retracement of the 1923 highs to 1179 lows, a common wave 4 movement. So we would continue now to be in a “Show me the money” state of mind near term, with concern that if that indeed was a wave 4 up, that a wave 5 to the downside, or at minimum a complex Wave D (Following ABC rally) would work off quite a bit of this $255 point rally. Downside targets are as low as 1271-1277 spot pricing which were our prior pivot lows of a lesser wave degree. Note on the chart the RSI levels are at nosebleed territory and this on a weekly chart no less. On daily views the MACD indicator is close to rolling over and giving a sell signal as well, and with the Monday action maybe it will once charts are updated on Tuesday this week. IN the meantime, the SP 500 index has dropped pretty hard and we have returned to only 38% Bulls down from 55% at the recent highs, and NYSE short interest is at screaming highs… indicating this market correction is getting closer to bottoming and therefore GOLD may see money come out. Just some things to think about to keep yourself balanced in your views. tmtfgold Consider joining us for daily updates on the SP 500 and Gold at www.markettrendforecast.com

TMTFGold

The Long and Winding Gold- (Bull Cycle about to Begin)

David Banister – www.TheMarketTrendForecast.com

The dramatic 2-3 day take down in Gold Spot pricing action smells and looks like capitulation to us at The Market Trend Forecast. We have been calling this entire 19-20 month consolidation period as a Primary wave 4 correction pattern, though complicated for sure. It has had multiple false rallies and buy and sell signals the entire time. With that said, the pattern is set up for final 5th wave decline which we are seeing now at the beginning of April.

Traditionally, Gold tends to meander or be weak in April anyways on a seasonal basis. This sets Gold up to rally in May into July with another soft patch, followed by a fall rally. However, our technical analysis is predicated on our Elliott Wave analysis, which says this entire 20 month correction is a “Double Three” correction pattern. Essentially its two ABC patterns with an “X” Wave rally in the middle to really confuse everyone.

The X wave took Gold to 1800 last fall before dumping all the Bulls off and eventually working its way down to the 1540’s levels we see today. This last leg down is a 5 wave decline and you know you’re at the bottom of wave 5 when everyone throws in the towel, the Gold stocks trade at multi year lows and relative valuation extremes. We also have insiders buying 7 to 1 over sellers according to Ink Research in the Gold stock sector. Stocks are valued at $923 per ounce equivalent even though Gold is trading north of $1,500 per ounce still.

We say bring it on and are actively accumulating selected Gold stocks with production profiles and growth metrics that are attractive.

See the Gold Elliott Wave analysis chart we sent to our paying subscribers a few days ago to forewarn of one more leg down. The next rally should be a doozy and have very few people on board. We would simply caution that a drop below $1523 spot pricing could lead to a blast down to the 1440-1460 areas, but its unlikely in our current views.

TMTFGold

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GOLD should be completing a cyclical low in February

David A. Banister www.markettrendforecast.com

Over the past 5 calendar years we have seen GOLD either complete an intermediate cyclical top or bottom in each February. My forecast was for February of 2013 to be no different and for Gold and Silver to make trough lows this month. With that said, I did not expect the drop in GOLD to go much below $1,620 per ounce at worst, but in fact it has. Where does that leave us now on the technical patterns and crowd behavioral views?

First let’s examine the last 5 years and you can see how I noted tops and bottoms in the chart below:

ATP1

That brings us forward to todays $1,573 spot pricing and trying to determine where the next move will go. To help with that end, some of our work centers on Elliott Wave Theory, along with fundamentals and traditional technical patterns of course. In this case, the recent action around Gold has been very difficult to ascertain, and I will be the first to admit as much. With that said, one pattern we can surmise is a rare pattern Elliott termed the “Double Three” pattern. Essentially you have two ABC type moves, and in the middle what is dubbed an “X” wave, which breaks up the ABC’s on each end of the pattern. For sure, if we add in traditional technical indicators along with sentiment, we can see very oversold levels coupled with the potential Double Three pattern and probably start getting long here for a trade back to the 1650’s as possible:

ATP2

Obviously this chart shows oversold readings in the lower right corner using the CCI indicator. That said we would like to see 1550 hold on a weekly closing basis to remain optimistic for a strong rebound.

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