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 Short term bounce rally underway

10 Aug 2015 11:46 AM | Bill Downey (Administrator)

Gold Update Aug 10 2015

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 to remove bearish trend.

Intermediate Term ~ Bearish– Need close above 1172-1182 for higher TREND.

Short Term ~Neutral– market at short term bottom at 1070-1080 and a rally to 1105-1110 or 1125 expected.

Initial Resistance 1105-1112  2nd tier 1122-1125

Support 1072-1082 2nd tier 1040-1150

Our last resistance listed 1094-1104 and price has just reached 1103 in the last half hour (11 am Mon) 

Gold Short term

Our last update favored a potential turn up to 1103-1108 and while the chart shows 1096 as the last, over the course of the last 30 mins, gold has turned up to 1103.  It looks like the 1106-1110 area is the next resistance area and we favor a move there.  Gold remains heavily shorted and thus we should consider this short covering for now.   But there is a decent base that was formed at the 1080 area.  We highlighted the potential to hold there as this area is the 50% total retracement of the entire correction.   In addition, seasonal factors are positive for August as the Indian wedding season approaches and gold buying for Christmas products usually occur at this time of the year.

Support remains SOLID right now at 1072-1080.   In summary, 1st resistance should be 1106-1110 with the potential to move to 1125.

 

Interest rates

Medium Term – Bullish for higher rates

Moving averages 21.11 – 21.07

The pullback in rates held right at the moving averages on the weekly charts and a move back up to test the long term green channel line is underway again.  The moving averages are turning up and that is a good that that if we take out the green trend line and the white one just above it, higher rates will become the medium term trend.   This time it won’t be because of good economic numbers, but of panic. 


Yes higher rates will potentially sell gold off, but it will be a fake out and part of the final wave down for gold.  The trend in rates is not far from turning up on a medium term basis.  As long as we hold the moving averages, and then take out the green trend line, odds will favor higher rates.  And higher rates will be bullish for gold.  Perhaps not quite at first, but certainly as the trend accelerates.

 

   

 

Cycles

The next cycle turn is due August 14th, plus or minus 72 hours.  Odds favor the bounce we’ve been expecting should occur this week.  However, it is important to note that the cycle window does open tomorrow and will last until the end of the week.  That favors a high in gold this week with a short term pullback to the end of the month.  If that develops, odds favor that Sept should see a decent bounce.  

 A close above 1103-1108 should lead to a bounce in the 1130-1150 area.  Only a close below 1172-1180 would change the short term picture.


  

 

HUI

Medium Term – Bearish

Medium Term Moving averages – 164 – 171

Intermediate Term Moving averages – 112.87 – 118.39

On a medium term basis, the next support is that yellow line near the 90 area.  Gold stocks have now entered the fifth and final wave down.  Either the yellow line holds or a COMPLETE retracement back to where the bull market started in 2001 is going to occur.  For now, the potential to move to the 90 area remains as the most likely MEDIUM term scenario, but a bounce higher this week higher could lead to a retrace near the 120 should develop.

   

 

Gold Medium Term

Long Term Trend ~ Bearish since Oct 2013 @ 1361

Long term Moving averages 1350 – 1429

Medium Term Trend ~bearish – Moving Averages 1190-1200


Gold supporting at the 1080 price area and the 50% retracement of the entire bull market.  Odds continue to favor gold will attempt a bounce here, but on a medium term basis, there is still no evidence that this will be the final low.  Not that it is out of the question, but it’s not the odds favored point.

Just the same, odds are high here that gold should hold the 1040-1080 area and at least try a rally attempt during August.   As long as we are below the dual yellow downtrend line, the medium term remains bearish.

   


 

GOLD ETF GLD

Moving Average Trend ~ 105.23 – 106.25 –bearish

GLD did find support at 103 and how the test is to overcome the moving averages on a short term basis.  That will be 1st resistance but also that gap in price on the way down at the 107-108 area and the white line at 109 is also resistance.  Odds favor a push to that area short term and then we’ll see.  

 

  

 

GDX

Intermediate term Trend   15.50 – 16.87 ~ Bearish

Resistance is at 13.88-14.42

GDX has broken the 2008 lows and until we reverse back above it the trends remain down. On a shorter term basis, price should bounce back and fill the gap and test the moving averages near 14-15 and the moving averages. With that said, the trend is still bearish.

 

  

 

What next ?

While the trends remain down in gold, we should be nearing a summer low in gold and the miners.  Odds are high that we should see a bounce into Mid August. Support should be 1072-1082.  However any close below 1072-1080 will warn of yet new lows into mid August.

Bottom Line

It’s best to remain bearish overall but to expect a bounce of some type here.  The key will be whether it overcomes short term resistance at 1105-1110 and near 1125.  



Technical Analysis :: Gold & Silver

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