Best of the Week
Most Popular
1. US Housing Market House Prices Bull Market Trend Current State - Nadeem_Walayat
2.Gold and Silver End of Week Technical, CoT and Fundamental Status - Gary_Tanashian
3.Stock Market Dow Trend Forecast - April Update - Nadeem_Walayat
4.When Will the Stock Market’s Rally Stop? - Troy_Bombardia
5.Russia and China Intend to Drain the West of Its Gold - MoneyMetals
6.BAIDU (BIDU) - Top 10 Artificial Intelligence Stocks Investing To Profit from AI Mega-trend - Nadeem_Walayat
7.Stop Feeding the Chinese Empire - ‘Belt and Road’ Trojan Horse - Richard_Mills
8.Stock Market US China Trade War Panic! Trend Forecast May 2019 Update - Nadeem_Walayat
9.US China Trade Impasse Threatens US Lithium, Rare Earth Imports - Richard_Mills
10.How to Invest in AI Stocks to Profit from the Machine Intelligence Mega-trend - Nadeem_Walayat
Last 7 days
Gold Golden 'Moment of Truth' Is Upon Us: $1,400-Plus or Not? - 18th June 19
Exceptional Times for Gold Warrant Special Attention - 18th June 19
The Stock Market Has Gone Nowhere and Volume is Low. What’s Next - 18th June 19
Silver Long-Term Trend Analysis - 18th June 19
IBM - Watson Deep Learning - AI Stocks Investing - Video - 18th June 19
Investors are Confident, Bullish and Buying Stocks, but… - 18th June 19
Gold and Silver Reversals – Impossible Not to Notice - 18th June 19
S&P 500 Stuck at 2,900, Still No Clear Direction - 17th June 19
Is Boris set to be the next Conservation leader? - 17th June 19
Clock’s Ticking on Your Chance to Profit from the Yield Curve Inversion - 17th June 19
Stock Market Rally Faltering? - 17th June 19
Johnson Vs Gove Tory Leadership Contest Grudge Match Betfair Betting - 17th June 19
Nasdaq Stock Index Prediction System Is Telling Us A Very Different Story - 17th June 19
King Dollar Rides Higher Creating Pressures On Foreign Economies - 17th June 19
Land Rover Discovery Sport Tailgate Not Working Problems Fix (70) - 17th June 19
Stock Market Outlook: is the S&P today just like 2007 or 2016? - 17th June 19
US China War - Thucydides Trap and gold - 16th June 19
Gold Stocks Bull Upleg Mounting - 16th June 19
Gold Price Seasonal Trend Analysis - Video - 16th June 19
Fethiye Market Fruit, Veg, Spices and Turkish Delight Tourist Shopping - 16th June 19
US Dollar Gold Trend Analysis - 15th June 19
Gold Stocks “Launch” is in Line With Fundamentals - 15th June 19
The Rise of Silver and Major Economic Decline - 15th June 19
Fire Insurance Claims: What Are the Things a Fire Claim Adjuster Does? - 15th June 19
How To Find A Trustworthy Casino? - 15th June 19
Boris Johnson Vs Michael Gove Tory Leadership Grudge Match - Video - 14th June 19
Gold and Silver, Precious Metals: T-Minus 3 Seconds To Liftoff! - 14th June 19
Silver Investing Trend Analysis - Video - 14th June 19
The American Dream Is Alive and Well - in China - 14th June 19
Keeping the Online Gaming Industry in Line - 14th June 19
How Acquisitions Affect Global Stocks - 14th June 19
Please Don’t Buy the Dip in Nvidia or Other Chip Stocks - 14th June 19
A Big Thing in Investor Education is Explainer Videos - 14th June 19
IRAN - The Next American War - 13th June 19
Boris Johnson Vs Michael Gove Tory Leadership Grudge Match Contest - 13th June 19
Top Best VPN Services You Can Choose For Your iPhone - 13th June 19
Tory Leadership Contest Betting Markets Forecast - Betfair - 13th June 19
US Stock Market Setting Up A Pennant Formation - 13th June 19
Which Stocks Will Lead The Cannabis Rebound? - 13th June 19
The Privatization of US Indo-Pacific Vision - Project 2049, Armitage, Budget Ploys and Taiwan Nexus - 12th June 19
Gold Price Breaks to the Upside - 12th June 19
Top Publicly Traded Casino Company Stocks for 2019 - 12th June 19
Silver Investing Trend Analysis - 12th June 19
Why Blue-Chip Dividend Stocks Aren’t as Safe as You Think - 12th June 19
Technical Analysis Shows Aug/Sept Stock Market Top Pattern Should Form - 12th June 19
FTSE 100: A Top European Index - 12th June 19
Gold Surprise! - 11th June 19
How Forex Indicators are Getting Even More Attention in the Market? - 11th June 19
Stock Market Storm Clouds on the Horizon - 11th June 19
Is Your Financial Security Based On A Double Aberration? - 11th June 19
What If Stocks Are Wrong About Interest Rate Cuts? - 11th June 19
US House Prices Yield Curve, Debt, QE4EVER! - 11th June 19
Natural Gas Moves Into Basing Zone - 11th June 19
U.S. Dollar Stall is Good for Commodities - 11th June 19
Fed Running Out of Time and Conventional Weapons - 11th June 19
Trade Wars Propelling Stock Markets to New Highs - 11th June 19
Best Travel Bags for Summer Holidays 2019, Back Sling packs, water proof, money belt, tactical - 11th June 19

Market Oracle FREE Newsletter

Gold Price Trend Forecast Summer 2019

Higher Highs coming in Gold!

Commodities / Gold and Silver 2010 Feb 02, 2010 - 09:42 AM GMT

By: Peter_Degraaf

Commodities

Diamond Rated - Best Financial Markets Analysis ArticleThe recent peak in gold on December 2nd was interrupted by a pullback that most likely ended with a double bottom on Jan 28th.  To help us determine if this pull-back is ready to give way to the next big rally we take a look at all of the pullbacks of 10% or more since the Gold Bull started its run in 2001.  There have been 9 such pull-backs, including the one just ending.


But first we draw your attention to a very bullish chart.  It is the chart that highlights the inverted head and shoulders formation that came to life when gold broke out above the important $1,000.00 level.  This breakout portends a target of $1,350.00 minimum, and some would conclude at target at $1,500.00

Next we will examine the various pullbacks of 10% or more that have occurred since the beginning of the gold bull market.

The first chart covers the rise to a top on February 5th 2003 that reached 19% above the 200DMA.  The subsequent pullback lasted 42 days.


The second chart covers a top on April 1st 2004 14% above the 200DMA.  The subsequent pullback ended 26 days later on May 10th.

Chart number three covers the gold price as it produced a top in late 2004 at 13% above the 200DMA.  The pullback that started on Dec 6th lasted 46 days.

Number four is the rally in gold that peaked May 14th/2006, 35% above the 200DMA. 

The subsequent pullback ended 23 days later, on June 15th.

Number five is the gold chart from early 2008.  Price had just experienced a nice run-up, and as often happens in March, price began a pull-back, after reaching a peak 22% above the 200DMA.  This pull-back began on March 19th and ended 32 trading days later on May 2nd. 

Number six is the gold price peak on July 15th, 11% above the 200DMA.  Price began to correct the next day and turned back up on Sept 12th, 41 days later.

Number seven is the top in gold that was produced on Oct 10th, a premature top, due to the credit crisis which brought everything down.  The subsequent correction ended on Oct 24th on day #11. 

Number eight is the gold peak of Feb 20th 2009 at 20% above the 200DMA.  Price corrected then and the correction ended 44 days later on April 24th.

On the assumption that gold’s action on February 1st confirmed the latest cycle bottom, 38 days from the Dec. 2nd top, then the average of the last nine gold bottoms is 34 days, indicating that the time for a turnaround was at hand.

In this last chart we throw some water on the theory that the HUI index always trends in the opposite direction to the US dollar.  Shown at the bottom of this chart is the US dollar for comparison.  During most of 2005, the HUI and the US dollar marched in lock-step.

The chart at the top is the HUI Index of gold and silver stocks and the chart at the bottom is the US dollar.  The period covered is from April to December 2005.

Because of very bullish fundamentals (more and more money chasing less and less gold), and because of the length of this pullback in terms of the number of days (38), and because the bears can only control price for so long, we are much closer to a bottom (think inches), than we are to a top (think miles).  Those of you who like to trade gold and silver stocks might like to visit the website and click on a popular feature: ‘Stock Pick of the Week’. 

DISCLAIMER:
Please do your own due diligence.  Investing involves taking risks.  I am NOT responsible for your trading decisions.

Happy trading!

By Peter Degraaf

Peter Degraaf is an on-line stock trader with over 50 years of investing experience. He issues a weekend report on the markets for his many subscribers. For a sample issue send him an E-mail at itiswell@cogeco.net , or visit his website at www.pdegraaf.com where you will find many long-term charts, as well as an interesting collection of Worthwhile Quotes that make for fascinating reading.

© 2010 Copyright Peter Degraaf - All Rights Reserved

DISCLAIMER: Please do your own due diligence. I am NOT responsible for your trading decisions.

Peter Degraaf Archive

© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Comments

rob
09 Feb 10, 01:15
higher highs or lower lows?

A nice bit of research and a not unreasonable theory - shot down in flames in an instant! Where does that leave us? With gold miner shares decidedly broken downward, it looks like a good bit more downside to come. At best. But perhaps Peter can bring us some new cheer!


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules