Best of the Week
Most Popular
1. Investing in a Bubble Mania Stock Market Trending Towards Financial Crisis 2.0 CRASH! - 9th Sep 21
2.Tech Stocks Bubble Valuations 2000 vs 2021 - 25th Sep 21
3.Stock Market FOMO Going into Crash Season - 8th Oct 21
4.Stock Market FOMO Hits September Brick Wall - Evergrande China's Lehman's Moment - 22nd Sep 21
5.Crypto Bubble BURSTS! BTC, ETH, XRP CRASH! NiceHash Seizes Funds on Account Halting ALL Withdrawals! - 19th May 21
6.How to Protect Your Self From a Stock Market CRASH / Bear Market? - 14th Oct 21
7.AI Stocks Portfolio Buying and Selling Levels Going Into Market Correction - 11th Oct 21
8.Why Silver Price Could Crash by 20%! - 5th Oct 21
9.Powell: Inflation Might Not Be Transitory, After All - 3rd Oct 21
10.Global Stock Markets Topped 60 Days Before the US Stocks Peaked - 23rd Sep 21
Last 7 days
CATHY WOOD ARK GARBAGE ARK Funds Heading for 90% STOCK CRASH! - 22nd Jan 22
Gold Is the Belle of the Ball. Will Its Dance Turn Bearish? - 22nd Jan 22
Best Neighborhoods to Buy Real Estate in San Diego - 22nd Jan 22
Stock Market January PANIC AI Tech Stocks Buying Opp - Trend Forecast 2022 - 21st Jan 21
How to Get Rich in the MetaVerse - 20th Jan 21
Should you Buy Payment Disruptor Stocks in 2022? - 20th Jan 21
2022 the Year of Smart devices, Electric Vehicles, and AI Startups - 20th Jan 21
Oil Markets More Animated by Geopolitics, Supply, and Demand - 20th Jan 21
WARNING - AI STOCK MARKET CRASH / BEAR SWITCH TRIGGERED! - 19th Jan 22
Fake It Till You Make It: Will Silver’s Motto Work on Gold? - 19th Jan 22
Crude Oil Smashing Stocks - 19th Jan 22
US Stagflation: The Global Risk of 2022 - 19th Jan 22
Stock Market Trend Forecast Early 2022 - Tech Growth Value Stocks Rotation - 18th Jan 22
Stock Market Sentiment Speaks: Are We Setting Up For A 'Mini-Crash'? - 18th Jan 22
Mobile Sports Betting is on a rise: Here’s why - 18th Jan 22
Exponential AI Stocks Mega-trend - 17th Jan 22
THE NEXT BITCOIN - 17th Jan 22
Gold Price Predictions for 2022 - 17th Jan 22
How Do Debt Relief Services Work To Reduce The Amount You Owe? - 17th Jan 22
RIVIAN IPO Illustrates We are in the Mother of all Stock Market Bubbles - 16th Jan 22
All Market Eyes on Copper - 16th Jan 22
The US Dollar Had a Slip-Up, but Gold Turned a Blind Eye to It - 16th Jan 22
A Stock Market Top for the Ages - 16th Jan 22
FREETRADE - Stock Investing Platform, the Good, Bad and Ugly Review, Free Shares, Cancelled Orders - 15th Jan 22
WD 14tb My Book External Drive Unboxing, Testing and Benchmark Performance Amazon Buy Review - 15th Jan 22
Toyland Ferris Wheel Birthday Fun at Gulliver's Rother Valley UK Theme Park 2022 - 15th Jan 22
What You Should Know About a TailoredPay High Risk Merchant Account - 15th Jan 22
Best Metaverse Tech Stocks Investing for 2022 and Beyond - 14th Jan 22
Gold Price Lagging Inflation - 14th Jan 22
Get Your Startup Idea Up And Running With These 7 Tips - 14th Jan 22
What Happens When Your Flight Gets Cancelled in the UK? - 14th Jan 22
How to Profit from 2022’s Biggest Trend Reversal - 11th Jan 22
Stock Market Sentiment Speaks: Are We Ready To Drop To 4400SPX? - 11th Jan 22
What's the Role of an Affiliate Marketer? - 11th Jan 22
Essential Things To Know Before You Set Up A Limited Liability Company - 11th Jan 22
NVIDIA THE KING OF THE METAVERSE! - 10th Jan 22
Fiscal and Monetary Cliffs Have Arrived - 10th Jan 22
The Meteoric Rise of Investing in Trading Cards - 10th Jan 22
IBM The REAL Quantum Metaverse STOCK! - 9th Jan 22
WARNING Failing NVME2 M2 SSD Drives Can Prevent Systems From Booting - Corsair MP600 - 9th Jan 22
The Fed’s inflated cake and a ‘quant’ of history - 9th Jan 22
NVME M2 SSD FAILURE WARNING Signs - Corsair MP600 1tb Drive - 9th Jan 22
Meadowhall Sheffield Christmas Lights 2021 Shopping - Before the Switch on - 9th Jan 22
How Does Insurance Work In Europe? Find Out Here - 9th Jan 22
MATTERPORT (MTTR) - DIGITIZING THE REAL WORLD - METAVERSE INVESTING 2022 - 7th Jan 22
Effect of Deflation On The Gold Price - 7th Jan 22
Stock Market 2022 Requires Different Strategies For Traders/Investors - 7th Jan 22
Old Man Winter Will Stimulate Natural Gas and Heating Oil Demand - 7th Jan 22
Is The Lazy Stock Market Bull Strategy Worth Considering? - 7th Jan 22
METAVERSE - NEW LIFE FOR SONY AGEING GAMING GIANT? - 6th Jan 2022
What Elliott Waves Show for Asia Pacific Stock and Financial Markets 2022 - 6th Jan 2022
Why You Should Register Your Company - 6th Jan 2022
4 Ways to Invest in Silver for 2022 - 6th Jan 2022
UNITY (U) - Metaverse Stock Analysis Investing for 2022 and Beyond - 5th Jan 2022
Stock Market Staving Off Risk-Off - 5th Jan 2022
Gold and Silver Still Hungover After New Year’s Eve - 5th Jan 2022
S&P 500 In an Uncharted Territory, But Is Sky the Limit? - 5th Jan 2022

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Gold, Time to Get Excited Again?

Commodities / Gold and Silver 2010 Apr 04, 2010 - 01:14 PM GMT

By: Merv_Burak

Commodities

Best Financial Markets Analysis ArticleIs it time to get all excited again?  Not yet.  Gold has had a couple of good days but has yet not breached any major resistance levels so the move may only be temporary within a basic lateral trend.  Let’s wait for better validation of the up move.


GOLD : LONG TERM

          

Little by little as I present these point and figure charts and talk about their construction and criteria I hope some of the conversation will be absorbed by readers and over time you will have a good understanding (and appreciation) of point and figure charts.  I no doubt will be repeating myself but that’s bound to happen.  Today I’ll just mention the trend lines.  My usual (about 99% of the time) trend lines are referred to as the 45 degree lines.  To make the chart more presentable the units are often skewed and their height and width may not be the same.  Therefore my definition of the 45 degree trend lines are lines whose slope is the slope of a line drawn from the center of one unit to the center of the next unit which may be one unit higher (up trend) or one unit lower (down trend).  When the height and width of a unit are exactly the same size we then have a true 45 degree slope, otherwise the slope is slanted accordingly.

The thick solid lines are primary trend or support/resistance lines.  The thinner the line the more secondary is the line.  Red lines are down trend or resistance lines.  The blue lines are up trend or support lines.  There is some confusion about those up trending resistance (red) lines or down trending support (blue) lines.  The up trend resistance lines are drawn from the wall of Os to the left of the break out point while the down trend support lines are drawn from the wall of Xs to the left of the break down point.  Enough of this week’s space filler.

Looking at the P&F chart we have a bullish break-out at the $1040 level with an initial projection to the $1230 level.  This is only a potential 8% move and indicates a very weak break-out at this time.  So, although we do have a bullish break it needs watching for any surprises ahead.  Of course, we have better projections from other earlier breaks so let’s hope those projections rule.

As for the usual indicators, nothing much has changed from the long term perspective.  The price of gold remains above its positive sloping long term moving average line and the momentum indicator remains in its positive zone above a now positive trigger line.  The volume indicator continues to move up and down but in a basic lateral direction.  On the Friday close it is above its slightly positive trigger line.  Although the volume indicator is tracking a basic lateral trend it does have an upward bias and is slightly higher than its level over the past couple of months.  The long term rating remains BULLISH.

INTERMEDIATE TERM

The intermediate term is a little brighter than last week.  Gold has once more moved above its intermediate term moving average line and the line has just turned to the up side.  The momentum indicator crossed into its positive zone the previous week and remained there during this week.  It is also above its now positive trigger line.  The volume indicator remains above its positive trigger line.  On the intermediate term we are back to a BULLISH rating.

SHORT TERM

          

The short term continues to look bright.  All the indicators are in the right direction although the very short term may be a problem.  We have a head and shoulder pattern on the short term chart.  As mentioned in the past I’m not fully into this being an H&S pattern because I’d like to see a significant move into the pattern.  My criteria for such a move are just short of being met here but the pattern is well drawn so let’s see what happens next.

Gold continues to move higher above its positive sloping short term moving average line.  The momentum indicator is moving higher in its positive zone and is above its positive trigger line.  The daily volume activity is a problem these past couple of days but that could just be speculators going on early Easter holiday.  The short term rating is BULLISH and the very short term moving average line has confirmed the rating by just moving above the short term line.

As for the immediate direction of least resistance, that would still be to the up side but with some caution.  The aggressive Stochastic Oscillator has moved into its overbought zone and seems to be in the process of turning around.  We’ll have to wait and see what it does on Monday as it could drop below its overbought line for a trend reversal warning.

SILVER

Silver performance this past week was far better than that of gold.  It is now at new recovery highs from its lows in early Feb.   We could use a little better upside volume action but that may come.  Silver seems to be where one should look as far as speculation is concerned. 

If one were looking at silver stocks one should avoid the top quality ones.  My Merv’s Qual-Silver Index of the 10 largest silver companies is only half way to its previous high from 2008 while the 25 Merv’s Spec-Silver Index stocks are at new all time highs with double the weekly performance of the Qual-Silver Index this past week. 

Looking at the performance of silver itself, one can plainly see the better performance here.  Unlike gold where the short term moving average line has not yet breached above the intermediate term line, for silver that breach came a few weeks ago and the short term moving average line remains above the intermediate term line for continuing confirmation of the positive trend.   What more can one say, all the time periods are BULLISH.

PRECIOUS METAL STOCKS

I keep mentioning the Merv’s Penny Arcade Index here.  As long as that Index is still positive the long term bull market in gold and silver stocks is expected to continue.  So it goes for another week.  That doesn’t mean there are not some warning signs of weakness in the Penny Arcade Index but nothing serious yet and nothing really of note.   The Index continues to be a top performer in all three time periods although the short term performance fluctuates quite a bit.  To be accurate this week’s performance was due almost exclusively to the performance of one stock which advanced 62.5% and gave the Index a gain of 2% by itself.  This stock was highlighted to subscribers a few months back and still has a P&F projection for another potential 500% move ahead.  However, this is what happens with the penny stocks, they do not all move in concert but sort of take turns moving.

As for the universe as a whole, gold stocks were ahead by 3.8% this week while the quality sector was ahead 5.8%.  The major North American Indices were up in the 6% to 7% area.  Two quality stocks had good upside moves and with the weighting these Indices apply, that would have given their Indices the slightly better performance versus the average stock performance of the Merv’s Qual-Gold Index.  The major North American Indices are still below their March highs.  Of the 8 Merv’s Indices only the Merv’s Qual-Silver Index is below its March high.  The Merv’s Gamb-Gold Index is into new recovery highs and the Merv’s Spec-Silver Index is into new all time highs.  These may be the sectors to concentrate your speculation on.

Merv’s Precious Metals Indices Table

Well, that will be it for this week.

By Merv Burak, CMT
Hudson Aero/Systems Inc.
Technical Information Group
for Merv's Precious Metals Central

For DAILY Uranium stock commentary and WEEKLY Uranium market update check out my new Technically Uranium with Merv blog at http://techuranium.blogspot.com .

During the day Merv practices his engineering profession as a Consulting Aerospace Engineer. Once the sun goes down and night descends upon the earth Merv dons his other hat as a Chartered Market Technician ( CMT ) and tries to decipher what's going on in the securities markets. As an underground surveyor in the gold mines of Canada 's Northwest Territories in his youth, Merv has a soft spot for the gold industry and has developed several Gold Indices reflecting different aspects of the industry. As a basically lazy individual Merv's driving focus is to KEEP IT SIMPLE .

To find out more about Merv's various Gold Indices and component stocks, please visit http://preciousmetalscentral.com . There you will find samples of the Indices and their component stocks plus other publications of interest to gold investors.

Before you invest, Always check your market timing with a Qualified Professional Market Technician

Merv Burak Archive

© 2005-2019 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