by Bill Downey     Price Analysis of Gold and Silver
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Technical Analysis Trading Gold, Trading Silver/ analysis By Bill Downey providing key turning points & charts for investors and speculators in Precious Metals Trading, and Precious Metals Markets

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Gold might be near short term bottom

02 Jul 2015 9:52 AM | Bill Downey (Administrator)

Trend

Long Term ~ Bearish- Need a monthly close above 1800 to confirm the bull market final phase underway. Need a monthly close above 1560 to neutralize the trend.
Medium Term ~ Bearish - Need a monthly close above 1255 and 1255 to remove bearish trend.
Intermediate Term ~ Bearish– Need close above 1222-1232 for higher TREND.
Short Term ~Bearish– caught in a sideways market 1160-1225

Initial Resistance 1172-1182  2nd tier 1187-1192
Support 1150-1162 2nd tier 1130-1140


Gold Short Term
A look at the very short term hourly chart suggest that gold may be making a short term bottom this morning.  It looks like a flushout under 1162 occurred and now gold is back above that area.  Overall, we need a close above 1172 and then the blue moving average must move above the green with price above both.   Platinum looks to already have bottomed and there is some divergence in MACD and a few other indicators suggesting a bounce may be ready to develop.   
 
 gold hourly price chart

Cycles
The next cycle is due July 1st (plus or minus 72 hours) and odds favor gold is putting in a low this morning where another attempt higher should occur.  As you can see, gold is trapped in a wedge between the higher and lower channel lines and we will need a price break out of this area before a more sustained move can develop.  In summary, odds are high that gold begins a recovery attempt into mid July.
 

gold cycles 


HUI
Medium Term – Bearish
Medium Term Moving averages – 173.06 - 179.84
Intermediate Term Moving averages – 154.96-157.07


On the downside we can move lower to the other support line at around 140 and it’s the last real support before new lows that would extend back 10 years.


The bottom line analysis at the moment is gold stocks are bearish on all time frames.  We need to see action back over the moving averages in an impulsive manner to change the outlook.  Gold stocks usually bottom during July/August and rally from mid August to mid October.  But that’s during a bull leg.  Still, we should see some type of action of that manner once a low is established. Support is that 140 area at the white trend line.  A move above 158 would suggest gold stocks can set up for a short to intermediate term rally.  Odds are high for a rally in gold stocks due to begin during July/August.  If we move to 140 and the white line odds will be high for at least a short term rally and perhaps during the summer.  But we must see some bullishness before just jumping in.  As we can see on the longer term chart below, we need to hold at around 140.

 

Gold Medium Term
Long Term Trend ~ Bearish since Oct 2013 @ 1361
Long term Moving averages 1350 – 1429
Medium Term Trend ~bearish – Moving Averages 1201.65 – 1209.26

Look at how the 1172-1182 area has held so far this year on yearly support.  The big question is however, is gold getting ready to break to the 1050-1100 area?  It is certainly possible.  If we close below 1162 and then 1140, odds will greatly increase that it will develop.  But at the moment, the market is in its worse chop we have seen for years.

June is a pivotal month and we often see important price lows.  Just look at the last three years.  IF gold breaks lower here, odds would favor we’re heading towards 1050-1100.  However, a weekly close above 1225 and then 1255 would begin to favor a rally into July/August (which in itself is often a bearish move).

If there is one PLACE to look for the BULL/BEAR line it’s this 1172-1182 area.  As long as price remains above that level, then an upside move can still take place.  Any weekly close below 1158-1163 favors lower. On the upside we need a weekly close above 1225 and then 1255 to get some action to the upside going.

We stated during the rally from November to January that the bull market in gold can ONLY resume if we take out the dual triple green channel lines and make it support. Price reached the middle line at the triple green trend line and then turned back down and has not looked back since. And that’s really the bottom line. In order for the gold market to resume its bullish form gold absolutely must make the triple green channel line a price support point and not resistance.

The one thing to note here is the medium term moving averages are at 1201-1209 and that is the area price resides in as we enter the final week of June. A move above the dual yellow lines would favor a rally to either 1300-1322 and as far as the triple green channel lines.  That is where a summer rally would most likely fail and lead to one final bottom between October 2015 and June 2016.
 
 

GOLD ETF GLD
Moving Average Trend ~ 113.28– 113.35 – Neutral/bearish

GLD (like gold) is a trading nightmare at the moment of sideways erratic movement.   Until things give trending indication, its best to be patient.

Resistance is 118-121 and support at 108-110 and that’s the range we keep trading in.  Those two white lines are the last real support (not seen on the chart below) is 98-105 and near the 84 area.
 

GDX
Intermediate term Trend   18.43 – 18.66 ~ Bearish
Resistance is at 20.08 – 20.22

GDX is stuck in a long trading range between 17 and 23.
Whenever that occurs for this length of time, its best to take the moving averages with a grain of salt.

A retest of the green line---which is basically the 2008 crash low line can’t be eliminated.
 


 
What next ?
We have arrived at the mid point of the year. Interesting that COMEX in NY closed at 1172.
Things are very quiet and not moving anywhere.  It will remain so probably until after the July 4th holiday.
Odds favor gold makes a short term low in the next day or so.

Bottom Line
June often is a turning point but it can extend into July.  Evidence that gold should be bottoming short term is showing up as platinum and palladium seem to be making their lows as well.


Technical Analysis :: Gold & Silver

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