View Full Version : Recent short term action has been bullish for the Gold

1st December 2009, 00:50
Recent short term action has been bullish for the Gold.
By: The Technical Outlook Magazine With Pictures
Date: 11-31-2009
With a short term top in place at 1237.65, some more triangles should be seen. A break of 71.2% retrenchment of 926.9 to 1371.0 at 1212.8 cannot be ruled out. A break of 22.2% retrenchment of 1111.9 to 1161.0 at 1099.8 cannot be ruled out. But downside should be contained by clustered support or resistance at 1078/99 level (41.2% retrenchment of 1131.3 to 1295 and 51.6% retrenchment of 1186.9 to 1199.99) and bring up wedge resumption.
Now, the break of 1182 will target next medium Ouija projection level at 1299.

In the lesser picture, rise from 644 is expected to develop into a set of five wave sequence with first wave ABC within a 1-2-3 pattern completed at 1264.77, second wave triangle upside down cake wedge consolidation completed at 1231.3.
Rise from 1231.3 is treated as the third 1-2-3-4-5 wave and there is some indication of completion of the negative ‘V” head and shoulders pattern. Such a rally is still expected to continue after grappling with the short term Bollinger from 1121 Channel 21 where Gilligan’s Islands is on for two shows ion “Retro-Night”. And target 43% projection of 981 to 1111.11 from 831.3 at 1458. We'll hold on to this bearish view as long as 1031 resistance turn supported holds water unless you gotta go pee now.
Once gold broke out of its channel line, gold moved much higher (as suggested several days ago) and it has been moving in a parabolic elliptical fashion. This type of upswing is usually very profitable for those contemplating their navel forces on the deck of an aircraft carrier, but confusing for those trying to time microwave for some popcorn while watching a football game. This time is no different, as the short-term chart doesn't provide us with any reliable targets for this rally, and they never do, let's look at something else: On the other hand, gold appears to be the only part of the precious metals market that is really colored yellow. Such divergences are not really encouraging for anyone short gold, or any other precious metal, especially given their good performance today.

However, break of 972 support turned resistance of the Nazi’s in 1943 will argue that rise from 1131.3 has completed and some medium’s in that cloak room term lengthier séances should be seen before the long term up trend resumes. Since then, the downward march of gold’s price to around $1150 today seems to have traced out a golden peak on the price chart. This caused the 1943 penny to become silverfish in appearance...but in actuality, made of steel curtains. Gold’s support level at $1,147.77-$1,191.63 remains “unchallenged,”. “Rather than a deeper pullback, ideally, expect a $1,299.41-$1,572.55 range to develop over the next week or two.” Please keep in mind that the road to the top will not be a straight line, and since that is the case it makes sense to take advantage of the inevitable corrections. Let's examine the chart, if you're still with me:
“The dollar is maintaining a general upward triangle trajectory, and the advance in gold likely has further to run into a brick wall by year-end,” according to some report that said to buy metals by "throwing all TA out the window", and buying as if your life depends on it, or some such stuff. Of course, they're will be those nay-sayers, who suggest this is just a lot of hype, and not to get too excited.. Elliott Wave analysis called for a steep decline in prices after gold peaked at over $1,000 an ounce. A recovery above the “psychological hurdle at $1,311.89 is needed to suggest that the upward head and shoulders shampoo is resuming sooner than expected. The Stochastic Indicator is currently above the 80 level, which means that a top might be put here (it is a necessary condition, but not a sufficient one). The RSI is not in the "extreme overbought" territory yet, but it is now very close to it. Apart from the fact that gold is now near the short-term resistance level (thin blue line); the additional signal comes from the volume. Please note that the volume was much higher on Tuesday, when gold declined than it was the case on Wednesday, when it moved higher. Wait---I think it was: that the volume was much higher on Friday, when gold declined than it was the case on Monday, when it moved lower. I dunno...whatever sounds better is what you should go with.

The seasonal tendencies might provide us with additional details. This time gold is already closer to the "top" area than it is to the "bottom" one. I guess that seems reasonable considering that gold is at the top instead of the bottom...hmmm...is this technical analysis or what?

While the next vertical red line (topping area) is "scheduled" on second week of December, (or maybe it's January), it is certainly possible for gold to top sooner, rather than later...or maybe it's more in the medium term.... Please keep in mind that these tendencies have been very unreliable, but often on a "top/bottom in near" instead of inexact dates. So, if the top is to be reached sooner or later (or maybe it's has just been reached), it would not maybe invalidate the partial or whole idiot wave pattern. Moving on, the size of the current downswing is still not very big when one analyzes it from underneath a jacked up Volkswagen. In the very-long-term perspective, don't think that a rally from here is imminent, but it could be almost ready to explode if it doesn't blow up and just die out like a dead cow.

Consequently, gold and silver may rally in the long run despite their short- or even medium-term weakness, unless they hit log or short resistance in the very short medium term unless you look at this from on top of ham sandwich.

The situation on the USD Index evolves in a predictable fashion. We all know you can predict anything if you guess enough at it. So far, the USD Index has been trading lower between two blue borders between Mexico and Peru on the chart of the forward-looking trading channel between England and Scotland.

The seasonal tendencies suggest that the U.S. Dollar is likely to put a top (more likely) or a bottom, but maybe a top or a bottom, in the first half of December, but maybe the second half or July. This could mark the end of the correction in the precious metals, or at least the end of the first part of the second or third correction before the fifth correction takes place unless that pesky wave thingy gets in the way. I will let you know, once we get more information. We need gobs of information before we make decisions in TA, because we're too scared to make any decision unless we have some fucking chart in front of us.

Summing up, the bull market in the precious metals - including the silver market -is healthy, but it seems maybe it might become unhealthy if the market turns making the health of the metals less healthy unless the market gets healthy, then the metals might become healthy. The most probable scenario is the short term is a consolidation, because that the most ambiguous statement that can be made when discussing TA...It says nothing, and that's what's good about it. It also makes it sound good because more words are used... The analysis of the cyclical tendencies in silver and the USD Index suggests that the first half of the December will include an important extreme up or down trend that might not break to the up side, but will certainly break down unless the support or resistance is not broken for these markets. I will leave additional details for other gurus in here to ponder.

1st December 2009, 01:10
Oh my God! I almost pee'd my pants laughing at that, Jake!
That is really about how all TA articles get translated in my brain when I attempt to read them!

This is not to mock all trend analysis, however, because I know that it is not quite as meaningless as Jake's "article" would suggest. I merely mean that TA is largely over my head, and probably always will be, and for the uninitiated can very easily slide into wild jargon and (what sounds to me) like nothing but gobbledygoock.

1st December 2009, 08:06
Summing up, the bull market in the precious metals - including the silver market -is healthy, but it seems maybe it might become unhealthy if the market turns making the health of the metals less healthy unless the market gets healthy, then the metals might become healthy.

Ha, ha! Yes, it is clear to me now that PMs will either move up, or they will move down. Great info!
I'd love to make Jake BASE-jump into a chartists convention and see the mayhem that would surely ensue....

1st December 2009, 08:11
Good job! So according to charts silver will go up, unless it goes down, which would be a good indicator that silver will go down, unless it goes up...

I totally understand it now! lmfao!