• 407 days Will The ECB Continue To Hike Rates?
  • 408 days Forbes: Aramco Remains Largest Company In The Middle East
  • 409 days Caltech Scientists Succesfully Beam Back Solar Power From Space
  • 809 days Could Crypto Overtake Traditional Investment?
  • 814 days Americans Still Quitting Jobs At Record Pace
  • 816 days FinTech Startups Tapping VC Money for ‘Immigrant Banking’
  • 819 days Is The Dollar Too Strong?
  • 819 days Big Tech Disappoints Investors on Earnings Calls
  • 820 days Fear And Celebration On Twitter as Musk Takes The Reins
  • 822 days China Is Quietly Trying To Distance Itself From Russia
  • 822 days Tech and Internet Giants’ Earnings In Focus After Netflix’s Stinker
  • 826 days Crypto Investors Won Big In 2021
  • 826 days The ‘Metaverse’ Economy Could be Worth $13 Trillion By 2030
  • 827 days Food Prices Are Skyrocketing As Putin’s War Persists
  • 829 days Pentagon Resignations Illustrate Our ‘Commercial’ Defense Dilemma
  • 830 days US Banks Shrug off Nearly $15 Billion In Russian Write-Offs
  • 833 days Cannabis Stocks in Holding Pattern Despite Positive Momentum
  • 834 days Is Musk A Bastion Of Free Speech Or Will His Absolutist Stance Backfire?
  • 834 days Two ETFs That Could Hedge Against Extreme Market Volatility
  • 836 days Are NFTs About To Take Over Gaming?
Another Retail Giant Bites The Dust

Another Retail Giant Bites The Dust

Forever 21 filed for Chapter…

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…

Is The Bull Market On Its Last Legs?

Is The Bull Market On Its Last Legs?

This aging bull market may…

  1. Home
  2. Markets
  3. Other

Time for a Brief Pause?

Now that gold has broken its daily cycle trend line I think we can assume that the daily cycle decline has probably begun. My best guess is that we will see gold drop into next week's employment report and test the support zone and intermediate trend line around $1340-$1350.

Spot Gold Daily Chart

We knew this was coming, as gold will enter the timing band for a daily cycle low on Monday, so no one needs to freak out. That being said, daily cycle declines need to make traders freak out in order to reset sentiment and prepare for the next leg up. So I suspect what is going to happen is that the bulls will try to defend that $1400 level for a few days, followed by a very scary $30-$40 crash day that will bring gold back down to the aforementioned support zone and form a final daily cycle low possibly on the employment report or the following Monday.

Spot Gold Daily Chart 2

I don't pay as much attention to the point and figure charts as I used to. I probably should as it spotted the daily cycle top at the declining trend line perfectly. I think we will break through that trend line during the next daily cycle.

Spot Gold Point and Figure Chart

The bullish percent chart is also suggesting it's time for a minor rest. It hasn't reached levels indicative of an intermediate top yet (80%-90%), but the big surge off the bottom needs to pull back and consolidate before the next push higher.

Gold Miners Bullish Percent Chart

All in all, I think traders need to prepare for some whipsaws early next week as the bulls try to defend $1400, followed by a hard move down into the daily cycle low at the end of the week or the beginning of the next week.

Once we put this daily cycle bottom behind us I think the next daily cycle will test the April stop run level at $1523. Then depending on what unfolds in the dollar we could very well see a fourth daily cycle higher that tests the QE 4 manipulation level at $1700-$1800.

 


I invite you to consider a $10 trial one month subscription to my daily and weekend reports.

 

Back to homepage

Leave a comment

Leave a comment