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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Bill Downey, of Gold Trends.net, LLC, is an Independent Investment Analyst with over twenty years of study. YOU SHOULD NOT TAKE ANY MATERIAL posted on this WEBSITE AS RECOMMENDATIONS TO BUY OR SELL GOLD OR ANY OTHER INVESTMENT VEHICLE LISTED. Do your own due diligence. No one knows tomorrow's price or circumstance. The author intends to portray his thoughts and ideas on the subject which may s be used as a tool for the reader. GoldTrends does not accept responsibility for being incorrect in its speculations on market trend or key turning points that it may discuss since they are at best a calculated analysis based on historical price observations.

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  • 23 Feb 2016 4:00 PM | Bill Downey (Administrator)


    Gold Short term

    We tested 1190 so far on this pullback but nothing more. Then we shot up to 1240, only to come back to 1202 before the move back to 1222 area. Support remains near 1180-1190. As long as we stay above 1205, the overall short term trend will be up. A close below 1205 and odds favor we test the 1180 area. On the upside, if we get above 1228, then there is still resistance at 1235-1240 and then 1255-1265. A MONTHLY CLOSE ABOVE 1255 would be big for the continuance of the upside.


    Gold Short term Cycles

    The next Cycle is due Feb 22nd (plus or minus 72 hours). That means that odds are 70% that gold will begin to move higher again after Feb 25th. The last cycle began early and finished right near the post 72 hour period. Any pullback to 1180 this week would be viewed as a short term buying opportunity.

    In summary, gold has burst into the 2015 uptrend channel and as long as we remain inside the channel the trend is up. Odds remain the upside action is in play as we make what looks like another blue cycle low.


    HUI

    Medium Term – Neutral

    Medium Term Moving averages – 122 – 126

    Intermediate Term Moving averages – 146-138— Bullish.

    The intermediate term trend remains bullish since Jan 28th and the medium term trend has moved to neutral as of Feb 1st. As long as we remain above 120-129 on a weekly basis the medium term has been neutralized.

    Support is now 144-150 and 120-126. As long as we are ABOVE 129 trends remain up. Any pullback to 140 should provide strong support. Any close above 166 would favor we are heading for 180-185 next. The trend remains UP.


    Long Term Gold Stocks

    On a longer term basis, the chart below shows the entire bear market in gold stocks. The current downtrend line is perhaps the most important line of all to take out. This would show that the current rally’s momentum is reversing the huge selloff. This is a massive bullish flag formation. But it needs the follow thru now.


    Gold Medium Term

    Long Term Trend ~ Bearish since Oct 2013 @ 1361

    Long term Moving averages 1224 – 1312

    Medium Term Trend ~NEUTRAL

    Moving Averages 1117-1126

    The big news technically is the dual downtrend yellow line got taken out and prices exploded to just under the 38% retracement area in gold. That is the last resistance on the weekly chart until the 1309-1322 and then near 1400.

    As long as we remain above the moving averages (1117-1126) the uptrend that started in 2016 remains in play. Since April of 2014, we have listed at the top of the report that we need a monthly close above 1255 in order to come out of bearish mode and move to neutral. The weekly close was 1247 so far in February (intraday was 1263).

    PULLBACK SUPPORT IS THE FIRST YELLOW LINE AND WE SHOULD SEE OUR FIRST SUPPORT ATTEMPT THERE near 1180-1200. IF we hold that dual yellow line, gold’s upside will still have potential for a total medium term trend change.

    In summary, the top dual yellow line is support, in between the lines is neutral and a close BELOW THE LOWER DUAL YELLOW LINE will put KEEP the bear trend in gold still in play. Look for the upper dual yellow line to provide SUPPORT and then we’ll see if gold can mount an attack back above 1255.



    Dow Jones (US STOCKS)

    US Stock Market – Medium Term Trend has moved from Bearish to Neutral.

    The US stock market is trying to climb back to the broken support lines. It would take a monthly close above Dow 17300 to neutralize the downtrend that is underway. On the downside, a monthly close below Dow 15300 would favor the next down leg has begun. Unless we get a miracle rally to month end, the Dow goes from bullish to neutral on the 29th if we are below Dow 17300.



  • 19 Feb 2016 2:14 PM | Bill Downey (Administrator)

    Gold encounters tramline resistance


    From John C Burford


    Now that gold has zoomed up by $200 off its $1,050 December lows, it is grabbing major headlines. Gold mining shares, which were shunned two months ago, are back in fashion. Isn't it curious how quickly sentiment can change?

    As a measure of market sentiment, I have shown charts before of the position of hedge funds in the futures market in terms of their holdings of long and short futures and options. Remember, the Comex gold futures market is the leading arena for price discovery – and the hedge fund group is the major player.

    I have stated many times that hedge funds are herding beasts – they are primarily trend followers, not contrarians. If they spot a definite trend, they will jump on it seemingly regardless of the dangerous waters that lie ahead.

    That means after a trend develops, hedge funds will, as a group, accumulate either long or short positions in the trend's direction. Then, when the trend turns, they are caught with a maximum amount of wrong-way bets. In gold, they have been adding bearish bets all the time during the downtrend last year. That is, until the trend change in December.

    And individual traders, who are not herders, can use this priceless information to our advantage.

    Here is the updated sentiment chart as measured by the Commitments of Traders (COT) data. Remember, this is not a survey (as is the Daily Sentiment Index that I often quote), but real money on the line. This is the ultimate commitment to express your views.


    chart courtesy www.elliottwave.com


    The blue line represents the net position of hedge funds (managed money) with respect to their long/short futures and options holdings. In December, a most unusual event occurred – they held a net short position (the record on the chart).

    For speculators, this is an all-time record level of bearishness.

    Just admire the coincidence of the highs in the market with the highs in the blue line. If an intelligent Martian landed and saw this chart and knew nothing about gold or trading or the futures markets, wouldn't it conclude that money can be made by shorting at the highs and buying at the lows as indicated by this COT data?

    Yet most hedge fund managers are oblivious to this rather obvious relationship. Maybe they are just not as smart as many believe. In fact, that is certainly true – otherwise we wouldn't have a chart, such as the above, to guide our trading.

    But in the main stream media at least, hedge fund managers are seen as very wealthy magicians who can conjure up millions for themselves in the markets.

    Today, I will show you my interpretation of the twists and turns of the gold market since the December lows.



    My blue lines are trend lines drawn against the minor highs, and every time the market broke above them that was a clear buy signal.

    My red wave 3 contains its own mini-five up and the spike high to the $1,265 high is my purple wave 3. This week's decline off it is my purple wave 4. Now, fourth waves can be very tricky affairs as.

    Wave 4 could morph into something more complex and even decline a little more before bottoming. But when wave 4 does terminate, a rally should take the market to the purple wave 5 high above $1,270.

    How does this fit onto the bigger picture? Here is the weekly chart going back to 2012:





    The $1,050 December low was the final fifth wave down off the 2011 top, and the rally since then is part of what should be wave 1 of a five up. I have excellent tramlines drawn (that amends the wedge conjecture in my 10 February email) and the spike high to $1,265 has bounced off the upper tramline as it hit resistance.

    If the market can break above that tramline, it will send a strong bullish signal and the masses of buy-stops placed above the highs that are arrayed along it since 2013 will be touched off – with explosive effect.

    But a word of caution: hedge funds are moving rapidly to the bullish camp (see first chart), so large sell-offs become much more likely. Traders beware!

    Until next time,

    John C Burford


  • 17 Feb 2016 12:55 PM | Bill Downey (Administrator)
    Launch GoldTrends.net    



    Everything has changed so far in 2016 for gold.  Instead of selling off after an NFP report, it didn't.  Instead of selling of going into an FOMC meeting, gold only pulled back for one day and it took off higher again.  Instead of selling off during Humphrey Hawkins testimony by Yellen it rallied from 1180 to 1260 over the next 24 hours.  Last but not least,  the last few years when China would close for their new year, the control boyz would press prices lower.  Again the opposite happened and gold rallied right thru the week.  When a market begins to do the opposite of what its used to doing it suggests that things have changed for trend.  While its not a guarantee we need to be alert when the next Options Expiration comes up at the end of the month, and the next NFP report as well as Fed FOMC meetings.  If the same thing happens, it will be another clue that the bear market is over.


    Support is that red channel line near 1190 and then the 1172-1182 area and then hear 1155.   Odds favor 1190-1195 or 1172-1182 will be this weeks low.






    This very short term chart on gold shows first support at 1190-1195 (Fib 38% re-trace) and that area was touched on Tuesday.  

    The 2nd support area is 1167-1172 (Fib 50% re-trace) and that is the area with the strongest support.  

    Resistance is the blue moving average near 1217 - 1222.





    ON the daily chart below here again we see the 1172 area showing it as a strong support area where the 2015 downtrend line crosses with the uptrend channel.  Price is now in 2015 territory and  that's another reason bullish development.




    Short term cycles

    The last blue cycle bottomed a few days and that happens once in a while. But the rally lasted right up until the last few hours of the  cycle window.  Here is yet another indication that gold (at the moment) is strong.  If this remains the case it's possible that gold will hold the 1190 area instead of moving to 1172.   Since the window for a turn doesn't open until Friday and the ideal day is not until Monday for a turn, I'm hoping gold will test the mid-channel line near 1180 and possibly break it by a little to test 1172.  That 1172 area is a YEARLY PIVOT NUMBER so it should offer strong support.  The other lower line is near the 1160 area but we don't expect it to be tested this week.

    The next cycle turn is due Feb 22nd (Plus or minus 72 hours).  That means the window for a turn opens Friday and will last thru next Thursday.  In summary, the intermediate term trend remains up in gold and as long as we keep making the lows on the blue cycle, the odds favor the trend remains up.   What we don't want is an inversion where we start making RED CYCLE LOWS.  That rotation is usually associated with a market that rises during counter trends and not the main trend.   The last ROTATION to a blue cycle low was right at the bear market lows.  As long as we remain with blue cycle lows, the odds favor the trend remains up.





    Silver 

    Silver has support at 1502-1510 and then at 14.80.  One of those two points should be this weeks low.   Resistance is 15.39-15.49 and 15.60.



    Is the bear market over ?

    We had Dec 2015 - June 2016 as our window for a bear market low and Dec or March as the two most likely months for a turn.

    For a price range we had 850-1050 as the zone where a low was most likely to occur.

    Decembers low was 1045.  That means that gold has met the requirements in price and time to bring an end to the bear market.

    Gold must close above at least 1130 on the last trading day of the February in order to move the medium term trend from bearish to neutral.

    More importantly we need to see a weekly and monthly close above 1255 to confirm the medium term trend is no longer bearish.

    Since April 24, 2015 that has been the number to watch on our reports for the medium term.   (Last week's close ws 1247).


    Bottom line is that there are many indications that the bear market is over for gold.  So far, we've gone from bearish to neutral.

    We still need to see a weekly and monthly close above 1255. 

    The key development is the dual yellow downtrend line has been exceeded and not it becomes support.   Resistance is the Fib 38% area from 1270-1288.  Its the last resistance until the 1322-1360.    The TRIPLE GREEN LINE IS THE BULL MARKET UPTREND.  Once gold makes that line support, odds are strong the new bull market into 2020 will be underway.  Finally, for the medium term trend to go back to bullish the blue moving average (1120) must cross above the red average (1130) with price above both on a monthly closing basis.



    In summary, the trend has gone from bearish to neutral, and as long as we are above 1120 on a monthly closing basis, odds are strong that the bull market has resumed.   Let's see what happens into month end.   (We have been above the moving averages 6 times during this bear market but have never closed above them on the LAST DAY OF THE MONTH.    So we want to see that (1130) and also 1255.



  • 16 Feb 2016 8:55 AM | Bill Downey (Administrator)

    Gold Medium Term

    Long Term Trend ~ Bearish since Oct 2013 @ 1361

    Long term Moving averages 1224 – 1312

    Medium Term Trend ~From bearish to NEUTRAL IS WE CLOSE ABOVE 1132 in February.

    Moving Averages 1120-1132

    The big news technically is the dual downtrend yellow line got taken out and prices exploded to just under the 38% retracement area in gold. That is the last resistance on the weekly chart until the 1309-1322 and then near 1400

    As long as we remain above the moving averages (1120-1132) the uptrend that started in 2016 remains in play. Since April of 2014, we have listed at the top of the report that we need a monthly close above 1255 in order to come out of bearish mode and move to neutral. The weekly close was 1247 last Friday (intraday was 1263).

    PULLBACK SUPPORT IS THE FIRST YELLOW LINE AND WE SHOULD SEE OUR FIRST SUPPORT ATTEMPT THERE near 1180-1200. IF we hold that dual yellow line, gold’s upside will still have potential for a total medium term trend chance.

    In summary, the top dual yellow line is support, in between the lines is neutral and a close BELOW THE LOWER DUAL YELLOW LINE will put KEEP the bear trend in gold still in play. Look for the upper dual yellow line to provide SUPPORT and then we’ll see if gold can mount an attack back above 1222-1238.



  • 10 Feb 2016 10:26 PM | Bill Downey (Administrator)

    Silver Long Term

    The very long term price of silver suggests that the Handle on the "cup and handle" pattern is just about complete. The bear market low should be where this dual support line resides. Accumulation of silver has been suggested since the 14 area and is still recommended.

    Chart from Kimble Charting Solutions with a few tweaks from Goldtrends.


  • 05 Feb 2016 6:34 AM | Bill Downey (Administrator)


    Gold Short term price and cycle Forcast

    Gold Short term

    On our last website update to subscribers, we discussed if 1115-1119 holds it would indicate strength and the 2nd spot to watch support would be 1105-1109. We discussed that as long as we held one of those two area’s that the short term would remain bullish. We got to 1109 and turned up. Wednesday took out the 1133 resistance and now we are at the last resistance area (1154-1164) before the 1190 area. Note there is a minor resistance at 1172-1176 as well.

    The big development was the push out of the uptrend channel and the momentum channel now rules. As of Thursday, we have arrived at the 2015 uptrend line and now we see if that area holds gold. Look for 1154-1160 to be resistance on and then we have the NFP report on Friday morning. This could be a catalyst for a push to 1190 in gold. But it could also engage the short term cycle TURN coming due starting Friday and into next week. The new support levels are 1129-1138 and then 1117-1122. In summary gold has increased upside velocity and the short term trend remains up, but time to be cautious short term. If we bust through 1165 then 1190 will be most likely target.


    Gold Short term Cycles

    Our last website update to subscribers stated a 70% odds favored higher price into Feb 8th. We also said any close above 1133 would be our confirmation. That has come to pass.

    We gave support at 1095-1110 and the low since then was 1109. Thus our last support range was also fulfilled.

    The next cycle date is Feb 8th (plus or minus 72 hours). That means the WINDOW for a turn opens on Friday and extends to next week (Feb 11th). THE NFP report on Friday will either push us to 1138-1143 or past 1160 and higher to next week (1190 area). Odds are 30% that this coming cycle can get a CYCLE INVERSION. That would mean higher prices for 2 more weeks !!!!

    We should look for a turn but to beware that this RED cycle is one of only 4 this year that HAS the HIGHEST INVERSION POTENTIAL. RSI on chart is also in overbought territory. If the bull hasn’t turned back up --- then a pullback is not far off.




  • 02 Feb 2016 8:01 PM | Bill Downey (Administrator)

    Chart of the Day: A “Silver Rush” in Chin

    By Eric Fry
    January 30, 2016

    Sometimes, if you can’t get to a party, you’ve got to bring the party to you. This approximate philosophy seems to be inspiring a surge of silver buying by the Chinese.

    Since the Chinese government is making it difficult for its citizens to take currency out of the country, many Chinese nationals are bringing a “better currency” into the country. They are buying silver hand over fist.

    Silver_Rush-550

    China’s silver imports recently hit their highest level in four years. Most likely, the Chinese are stepping up their silver purchases as a way to protect themselves from the risk that their currency, the renminbi, will continue to lose value against the U.S. dollar.

    During the last five months, the renminbi has fallen more than 5% against the dollar. This loss of value, combined with China’s collapsing property and stock markets, has triggered a massive “capital flight” from China into various offshore assets.

    A whopping $1 trillion has fled the country during the last 12 months, according to estimates by Bloomberg Intelligence. That’s about $770 for every man, woman and child in China!

    Capital_Stampede-550

    Because so much capital is fleeing the country so quickly, the Chinese government has stepped up its efforts to block the exits.

    The laws and regulations that were already on the books limited annual overseas transfers to $50,000 per person. But for many years, wealthy Chinese have used a variety of tactics to maneuver around this limitation.

    The government is now making the game much more difficult.

    Bloomberg News provided the following insight into the Chinese government’s latest efforts to prevent capital flight:

    • Increased scrutiny of transfers overseas – Some Shanghai banks have recently asked their outlets to closely check whether individuals sent money abroad by breaking up foreign currency purchases into smaller transactions and to take punitive action if violations were discovered, according to people familiar with the matter. Each person can send $50,000 abroad annually, so large sums can be transferred by utilizing the bank accounts and quotas of a range of individuals, a tactic known as smurfing.
    • Outbound investment quotas frozen – China has suspended new applications under the Renminbi Qualified Domestic Institutional Investor (QDII) program, which allows yuan from the mainland to be used to buy offshore securities denominated in the currency. It has also refrained from granting new quotas for residents to invest in overseas markets via the QDII program.
    • UnionPay debit card clampdown – New measures were introduced in December to crack down on illegal China UnionPay card machines, which were suspected of being used to channel funds offshore via fake transactions, most notably in Macau casinos.
    • Underground banking clampdown – China busted the nation’s biggest “underground bank,” which handled 410 billion yuan ($62 billion) of illegal foreign exchange transactions, the official People’s Daily reported in November. The Shanghai branch of the State Administration of Foreign Exchange said last week that it will crack down on illegal currency transactions, including underground banking.

    Perhaps these new government tactics will slow the exodus of capital over the short term. But capital controls rarely succeed over the long term. To the contrary, they are an ominous warning sign – the reddest of red flags. They announce to the world that it’s time to get local currency out of the country as fast as you can, and then swap that currency for hard assets offshore.

    But since that is easier said than done in China, some Chinese nationals are doing the next best thing: They are importing the hard assets from offshore and using their local currency to do it.

    So far, the recent surge of Chinese silver buying has not sparked a corresponding bounce in the silver price… at least not yet.

    But interestingly, the last time the Chinese ramped up their silver buying was in 2009 and 2010 – several months before the silver price rocketed from $15 an ounce to $50 an ounce.

    So if past is prologue, there might be a great big silver bull market heading our way.

    Cheers,

    Eric J. Fry
    For The Non-Dollar Report

    Gold Short Term

    The NFP report on Friday will most likely be the event of the week for Gold.  

    Resistance is the 1130-1138 area and then 1142-1146.  Most important is the uptrend channel and the momentum channel in short term gold is meeting at the 1130-1138 area.  A Friday close above 1143 would put price just above the uptrend channel and open the potential for the momentum channel to continue tracking gold price.  A close below 1115-1117 would take us out of the momentum channel and expose gold to retest the 1090 area.  There's also support at 1101-1109.   The bottom line is things might remain quiet in gold on Wednesday and Thursday in anticipation of the NFP payroll report on Friday morning.  The short term trend remains up.  A close below 1101 would turn the trend neutral.  


    Gold Medium Term

    Weekly gold arriving at the moving averages (1117 Blue and 1139 Red).  We need two weekly and a MONTHLY CLOSE above both to go from Bearish Medium Term Gold to Neutral.   Neutral is not bullish, but it ain't bearish.  The Dual Yellow trend line's upper end is the 1172-1222 area. Look how there is almost no resistance above the Dual Yellow lines for quite a distance. A monthly close above 1255 would be a significant event.  It takes a monthly close below 1033 in order to extend the bear market lower.  Odds still favor the low is either in Dec 2015 (Armstrong 51.6 month cycle) or March/April 2016 (A Fibonacci 55 months from the high).  So far, December has been the lowest price at 1045.  If the bear market in gold is over, it needs to take out the Dual Yellow trend line on a monthly close for further confirmation. 



  • 29 Jan 2016 7:51 PM | Bill Downey (Administrator)
    Let's take a look at what the charts have to say

    Gold Cycles and Technicals

    The next cycle is due Feb 8th (plus or minus 72 hours). That means the cycle opens up by Feb 5th.  We pulled back from weekly resistance 1122-1127 hitting 1128 and pulled back to first support, the downtrend line from the October peak at the highest blue cycle on the chart.  There's another line underneath that pegs support at 1101-1109 (1095 also).  Bottom line, the short term uptrend is still in play, but cycles will be here by the end of next week.   We can still pullback a bit more and move back up during mid week next week. We got to 1108 on Friday but reversed back up there so we know there's a band of support at 1101-1109.  That's what it comes down to early next week.  On the resistance side, look for 1122-1125 and then 1128-1133 where the 200 day average resides.  We get above 1145 then look for 1160-1190. 

    In summary,  the 200 day average is the biggest target if the bulls win at 1133.  The bears meanwhile would like to get back below 1095.  if the cycle plays out, there should be one more push higher (odds 70%). 


    HUI GOLD STOCKS

    After 6 months of not making a new low, the HUI index gave way and then did something that should be watched closely, or at least on your radar.  Prices reversed and marched right back to a strong resistance area on the chart.  The first thing a bear market must do is reverse a new yearly low.  It has done that. We should at least make note of it.  

     Now comes the 1st resistance test and that's the ability to move above the first resistance points of the market.  A close above this area would favor the HUI moving to the 140-145 area.  



    Gold and the short term current price point

    The bottom line for next week is we must get above 1133-1143 in order to push higher (1160-1190).  As long as we're in the channel, we're in the 2016 uptrend.  Support should be 1095-1107.   Resistance we have 1122-1127 then the 200 day at 1133 and the November High at 1143.  A new MONTH begins Monday. 



    On a medium term basis, the key is really the moving averages 1119-1138 and the dual down trend line.  That is the strongest resistance on the chart and the last solid resistance (medium term) until 1272-1322.  This is the price potential if gold can exceed these two most important resistance point until a couple of hundred bucks higher.   Key next week also is the November high at 1143.  We get a close above there and 1172-1190 would be the target.  


    On the intermediate term time basis, a Feb high and pullback into March is still the most favored outcome, so watch that cycle turn and the November high.  

    On a longer term basis

    Odds favor the bear market in gold ends Dec 2015-June 2015 (with March as the ideal) in a price range of 850-1050.   If the low wasn't December then the Ideal time for it will be in March on the 55th month of the correction.  

    We needed a close above 1119.50 on Friday to be above the 34 week moving average. We got within 90 cents.  But we did not get above it.  Is a dollar close enough?    Not if we follow the rule.  But it should be watched just the same.  Nothing is that PRECISE.  Nevertheless, we did not get a MONTHLY close above the average.  Doesn't mean we won't in February.  Suffice to say, this 1130-1145 area in gold is the most important area for a couple hundred dollars.


  • 26 Jan 2016 12:52 PM | Bill Downey (Administrator)

     According to the Hong Kong Census and Statistics Department, in December Chinese gold imports via the main conduit Hong Kong surged to the highest in more than two years, as - in Reuters words - "investors lost faith in collapsing stock markets and a weakening currency and snapped up bullion."

    That was the highest monthly number since October 2013 when imports stood at 130 tonnes.

    According to Bloomberg, "Investors took advantage of the lowest global prices in almost six years to stock up on bullion amid share market gyrations and concerns the central bank would let the currency depreciate to boost slowing growth in the world’s second-biggest economy. Consumers were also buying in the run-up to Chinese New Year in February, the peak demand season."

    As China's equities slumped and its yuan currency finished 2015 with a record yearly loss, "people looked at other investment  alternatives that's why there was huge demand for gold," said Brian Lan, managing director at gold dealer GoldSilver Central in  Singapore.

    't just suddenly soaring demand for phiscal gold: a jump in physical deliveries from the Shanghai Gold Exchange was also a sign of demand, Wang said.

    Also, Hong Kong wasn't the only source: Swiss exports of gold to China jumped to 59 tons in December from 16.5 tons a month earlier, according to the website of Swiss Federal Customs Administration.


    Gold Short Term

    Gold has arrived at 1st weekly resistance in the 1122-1125 area.  Additional resistance lies at the 1129-1136 area.  Today's options expiration has unshakled and now the FOMC minutes and meeting will adjourn on Wednesday afternoon.  Key is whether the FED comes out with more dovish statements in lieu of what has happened to the stock markets globally and the deteriorating global economies.  These are the highest gold prices we have seen since November 6th 2015.  It is still possible to reach resistance # 2 as short covering and buying are taking place.  Odds are that would take place tomorrow during mid week Wednesday if we do plow above 1125.  Support is now forming at the 1095-1102 area and the 1080-1085 area.  Short term trends remain up, but odds do favor gold's peak this week to be either 1122-1125 or 1129-1136.   

    Gold Medium Term

    On a medium term basis,  the blue moving average is at 1119 and the Red at 1138.  Thus we should see perhaps resistance attempts at both places.  It takes TWO monthly closes above both averages for the medium term to go from bearish to neutral and it takes a monthly close for the blue average to be above the red and price as well to get a trend change to bullish.  The dual yellow lines are also defined as the current downtrend lines lines to watch.   Two monthly closes above the dual yellow line would be 2nd confirmation that the medium term trend has turned up for the 1st time since 2013.  


  • 25 Jan 2016 10:56 AM | Bill Downey (Administrator)

    Gold Report ~ Jan 25 2015

    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 to bring attention to the medium term trend. Two weekly and a monthly close above 1141 would upgrade the trend from bearish to neutral.

    Intermediate Term ~ Neutral– The intermediate term is in neutral mode for the most part but a close above 1114 flips the trend to bullish.

    Short Term ~Bullish- Any close above 1114 extends the trend. Any close below 1072 reverses the trend to down.

    Initial Resistance 1107-1114 2nd tier 1122-1132

    Support 1082-1092 2nd tier 1065-1075

    OPTIONS EXPIRATION for Feb gold ends after Trading on Tuesday Jan 26th. Thus we’re going to find out this week if gold can move and sustain above 1100. The shackles will be released, and now its up to gold.

    Also, rollover out of Feb Gold and into April will take place on the futures markets.

    On Wednesday, minutes of the FOMC will be released.  Keep a watch for that also as a potential price mover in gold.

    What about the Stock Market?

    The correction thus far has reached the deepest level of long term uptrend support at the moving averages and trend line. Here is where the stock market should try and bounce and it may be underway from last week’s low. The long term averages are at 16030 – 16700. A monthly close below 15900-16000 is the next step as to whether we get a continued selloff. Watch January’s close to see if it’s above 16000. As we arrive in February,  the US stock market is at critical levels. It has not yet broken the long term uptrend.   But on this next Chart.........



    Dow Quarterly Chart

    On Dec 31st we posted this chart on Twitter.  It gave a long term sell signal on the quarterly chart.  Since then a correction has taken us to the chart above.  Monthly closes below 15300 would be add to the bearishness already witnessed.  Odds favor that a rebound at these levels will take place, but we doubt if the carnage is over in stocks.



    What about interest rates?

    Interest rates have at this moment moved to neutral on a long term basis. But the real decision continues to be put off as rates keep hitting off the grend trend line. We have completed a Fibonacci 34 years of lower rates. Odds favor that higher rates are in our future. Odds also favor that it will be due to FEAR and not global growth.

    Higher rates should be bullish for gold. Perhaps not right away, but certainly once the trend gets established higher. There is no other chart more important as one that shows the COST OF MONEY - for it sets the pace of everything else.  As we arrive In February, the long term trend for rates has yet to turn up.


    What about Commodities?

    The chart shows we are at the most important of all support points. Below this area warns of Global Depression.


    What about Gold?

    Gold is nearing the Edge of the Wedge, but it still can have one final low in March/June 2016.  If gold is to turn up in 2016, odds favor that it needs commodities to turn up also.


    Gold Short term

    The chart below shows the key area we need to move above (1107-1114) in gold in order to favor higher towards 1121-1131 or 1141-1146. Support is 1088-1094 and then 1072-1082 for this week. IF we can close above 1114, odds favor moving higher into month end and 1st week of February.



Technical Analysis :: Gold & Silver

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