Most Popular
1. Banking Crisis is Stocks Bull Market Buying Opportunity - Nadeem_Walayat
2.The Crypto Signal for the Precious Metals Market - P_Radomski_CFA
3. One Possible Outcome to a New World Order - Raymond_Matison
4.Nvidia Blow Off Top - Flying High like the Phoenix too Close to the Sun - Nadeem_Walayat
5. Apple AAPL Stock Trend and Earnings Analysis - Nadeem_Walayat
6.AI, Stocks, and Gold Stocks – Connected After All - P_Radomski_CFA
7.Stock Market CHEAT SHEET - - Nadeem_Walayat
8.US Debt Ceiling Crisis Smoke and Mirrors Circus - Nadeem_Walayat
9.Silver Price May Explode - Avi_Gilburt
10.More US Banks Could Collapse -- A Lot More- EWI
Last 7 days
Stock Market Volatility (VIX) - 25th Mar 24
Stock Market Investor Sentiment - 25th Mar 24
The Federal Reserve Didn't Do Anything But It Had Plenty to Say - 25th Mar 24
Stock Market Breadth - 24th Mar 24
Stock Market Margin Debt Indicator - 24th Mar 24
It’s Easy to Scream Stocks Bubble! - 24th Mar 24
Stocks: What to Make of All This Insider Selling- 24th Mar 24
Money Supply Continues To Fall, Economy Worsens – Investors Don’t Care - 24th Mar 24
Get an Edge in the Crypto Market with Order Flow - 24th Mar 24
US Presidential Election Cycle and Recessions - 18th Mar 24
US Recession Already Happened in 2022! - 18th Mar 24
AI can now remember everything you say - 18th Mar 24
Bitcoin Crypto Mania 2024 - MicroStrategy MSTR Blow off Top! - 14th Mar 24
Bitcoin Gravy Train Trend Forecast 2024 - 11th Mar 24
Gold and the Long-Term Inflation Cycle - 11th Mar 24
Fed’s Next Intertest Rate Move might not align with popular consensus - 11th Mar 24
Two Reasons The Fed Manipulates Interest Rates - 11th Mar 24
US Dollar Trend 2024 - 9th Mar 2024
The Bond Trade and Interest Rates - 9th Mar 2024
Investors Don’t Believe the Gold Rally, Still Prefer General Stocks - 9th Mar 2024
Paper Gold Vs. Real Gold: It's Important to Know the Difference - 9th Mar 2024
Stocks: What This "Record Extreme" Indicator May Be Signaling - 9th Mar 2024
My 3 Favorite Trade Setups - Elliott Wave Course - 9th Mar 2024
Bitcoin Crypto Bubble Mania! - 4th Mar 2024
US Interest Rates - When WIll the Fed Pivot - 1st Mar 2024
S&P Stock Market Real Earnings Yield - 29th Feb 2024
US Unemployment is a Fake Statistic - 29th Feb 2024
U.S. financial market’s “Weimar phase” impact to your fiat and digital assets - 29th Feb 2024
What a Breakdown in Silver Mining Stocks! What an Opportunity! - 29th Feb 2024
Why AI will Soon become SA - Synthetic Intelligence - The Machine Learning Megatrend - 29th Feb 2024
Keep Calm and Carry on Buying Quantum AI Tech Stocks - 19th Feb 24

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Fascinating Gold Charts With Hidden Trendlines

Commodities / Gold and Silver 2016 Feb 19, 2016 - 03:24 AM GMT

By: InvestingHaven

Commodities

Gold had another very strong day, closing the day 2% higher. After a strong run over the last couple of weeks, the question is where gold stands, and how much upside potential it has. Let’s revise the charts and leading indicators in this article.

First, our daily gold chart (since gold peaked) shows that gold recently broke out of its downtrend. Interestingly, the gold price retraced this week to just below the resistance line, and closed today 1% above it. So far so good, this is strong price action without any doubt.


The more fascinating chart, however, is gold’s longer term chart. Our focus is on the hidden trendlines which have a predictive value. As readers know, hidden trendlines connect extreme swing highs and lows: the more extreme the swing, the more important its value. Gold’s hidden trendlines show four areas which we indicated with a red number.

We are currently in area 1, which is gold’s last chance. In other words, this is the area which has a last support line which could provide support for gold’s tactical correction in its secular bull market. Gold is currently moving very fast from support to resistance within area 1. In other words, nothing meaningful has changed with gold’s recent rally.

In order for a meaningful trend change to take place, gold has to move to area 2, and, ultimately, area 3 if it aims to continue its secular bull market. We are not there yet. Watch $1,300 and $1,450 as key price points: gold’s ability to sharply break those price levels, or inability to break that resistance, will tell us whether a real trend change will take place.

One of gold’s leading indicators is the market structure in the COMEX futures market. According to the latest data, we believe there is still some upside potential in the gold price. The rate of change of short positions of commercial traders has been rather high (not bullish) but their positions did not reach any sort of extreme level (quite bullish). So we consider a high probability of gold testing $1,300 rather soon.

Gold miners, if anything, have shown a clear message: they are back. However, as the gold mining sector has been slaughtered, we see weakness in a lot of individual gold mining charts. There is still clear bifurcation within the gold mining segment. So investors should be very careful picking gold miners. As a leading indicator, however, they have been performing well enough, confirming strength in the gold market.

We are closely watching how gold miners and broad stock indexes behave as gold will test its critical $1,300 level.

CONCLUSION:

There is momentum in the gold market, and our chart with hidden trendlines shows the potential for gold to move to $1,300. That is confirmed by the leading indicators in the gold market, i.e. COMEX futures market structure and the gold mining segment.

However, gold’s recent strength is not yet the real deal. This rally is ‘for real’ once gold breaks above $1,300 (with conviction), and even more so above $1,450.

http://investinghaven.com

Analyst Team
The team has +15 years of experience in global markets. Their methodology is unique and effective, yet easy to understand; it is based on chart analysis combined with intermarket / fundamental / sentiment analysis. The work of the team appeared on major financial outlets like FinancialSense, SeekingAlpha, MarketWatch, ...

Copyright © 2016 Investing Haven - All Rights Reserved Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


© 2005-2022 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

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