• 9 hours Mexico Kickstarts War On Junk Food
  • 17 hours How America Could Go Green Right Now
  • 2 days Russian Prestige And American Politics: The COVID Vaccine Race
  • 2 days Is The Silver Rally Over Or Just Getting Started?
  • 3 days Alibaba-Backed Tesla Competitor Set To IPO In The U.S.
  • 3 days Emerging Economies Could Get Left Behind In Race For COVID Vaccine
  • 3 days Dead Malls Could Be Amazon’s Next Target
  • 4 days Unpacking Biden's Energy Plan
  • 4 days Russia Aims To Become World's Top Gold Producer
  • 4 days Global Tech Stocks On Edge Over Trump TikTok Ban
  • 5 days Cobalt Squeeze Threatens The Electric Vehicle Boom
  • 5 days COVID Has Sparked A Surge In Cybercrime
  • 6 days Precious Metals Bulls Still Have Plenty Of Room To Run
  • 6 days The U.S. Has The Tech To Go Green, But Will It Use It?
  • 7 days Massive Losses Force Russian Commodities Giant To Slash Dividends
  • 7 days Markets Up On Stimulus Hope
  • 8 days UK To Invest In Europe's First Geothermal Lithium Recovery Plant
  • 8 days TikTok Takes Center Stage In US-China Tech War
  • 9 days Are Semiconductor Stocks Overvalued?
  • 9 days Jobs Report Doesn’t Say Much Amid COVID Uncertainty
What's Behind The Global EV Sales Slowdown?

What's Behind The Global EV Sales Slowdown?

An economic slowdown in many…

Zombie Foreclosures On The Rise In The U.S.

Zombie Foreclosures On The Rise In The U.S.

During the quarter there were…

How The Ultra-Wealthy Are Using Art To Dodge Taxes

How The Ultra-Wealthy Are Using Art To Dodge Taxes

More freeports open around the…

  1. Home
  2. Markets
  3. Other

Gold - 2006 Similarities and Correction Over?

I guess a lot of people wet their pants last night, as gold was down over 4% at some point. The chart incurred technical damage over the short term, and if current support fails to hold, gold could be headed for about $1,440 (or the equivalent of $140 GLD), as we will discuss later on.

Let's first have a look at an article I wrote in August 2011 when I wrote: Gold 2006 vs Gold Today, Does It Look Familiar?

When we look at the following charts, we can see that the pattern is still valid so far.

The pattern would become invalid if gold fails to hold above the green support line without reversing soon.

Gold 2006 vs Now
Larger Image

Overlay:

Gold 2006 vs 2008 overlay
Larger Image

In the nightly report of Tuesday night, I posted the following chart, indicating GLD might drop towards 152-153.

GOLD Tuesday
Larger Image

Last night, GLD hit a low of 152.05, and thus hit the target PERFECTLY, as we can see in the chart below.

The RSI is oversold on a daily basis, and volume spiked to panic levels.

Those are facts that should bode well for gold going forward.

GLD - target reached
Larger Image

If GLD fails to hold above the green support line, we can expect a drop towards $140.

When we look at the Bullish % index for mining stocks, we can see that it reached an extremely low level again at 13.79.

This should also bode well for both gold and gold stocks. However, the HUI might still retest the pink support/breakout line over the next couple of days...

BPGDM
Larger Image

However, if we would get a remake of 2008, even those indicators can't stop prices from falling, so be cautious!

 

Back to homepage

Leave a comment

Leave a comment