Graceland Updates 4am-7am
Oct 22, 2013
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The US government is finally releasing the jobs report today. Most institutional players are expecting the report to show that about 180,000 new jobs were created in September.
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Many analysts believe this report is not too important, because data may be missing due to the government shutdown.
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Regardless, if the report shows 200,000 (or more) jobs were created, I expect " taper caper" talk to begin again, and that could put a bit of pressure on gold prices.
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If the report shows very few jobs were created, gold should surge higher.
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Please click here now. That's the daily gold chart, and from a technical perspective, gold and silver look quite good.
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Gold has staged an upside breakout from a bullish wedge pattern, and my stokeillator (14,7,7 Stochastics series) is in a rising mode.
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An uptrend is defined as " rising highs and rising lows". Gold needs to rise above the minor trend highs of $1330, $1351, and $1375.
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$1375 is a particularly important price area, because it represents the right shoulder high of the head and shoulders top pattern that many gold bears are focused on.
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A move above $1375 would destroy the top pattern.
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Please click here now. That's another look at the daily gold chart. If the breakout from the wedge pattern is real, gold could easily pull back to the $1300 area, or even lower, before moving higher.
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That pullback could make the chart more bullish, because it would create an inverse head and shoulders bottom pattern, with a target of $1400 - $1425.
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If gold can rise above the highs near $1432, many momentum-oriented investors would likely buy gold, and that would add more upside pressure to the price.
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I believe that gold is likely to trade at $1480 before it trades at $1180.
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What about silver? Please click here now. This daily silver chart is very bullish. If silver can rise above $22.50, I think momentum players could push the price to the key $25 HSR (horizontal support and resistance) area.
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Arguably, both senior and junior gold stocks are even more bullish than the metals are.
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Please click here now. You are viewing the GDX daily chart. Note the HSR line that I've highlighted in the $28.50 area. That line is important because these are the highs that were created by the Fed's " no taper" statement.
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Trading volume surged as those highs were made, so $28.50 is clearly a key price that big players are focused on. If GDX can stage an upside breakout from the green bullish wedge pattern, an assault on the " no taper" highs is very likely.
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It could be argued that there is also a substantial double bottom pattern in play, with the first bottom defined by the July lows in the $22.50 area, and the second bottom defined by the lows in the same price area that were made just a few days ago.
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The neckline is the HSR zone at about $31.50, and the upside target of the pattern is $40.
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Please click here now. The same double bottom formation is apparent on the GDXJ chart, and the trading volume pattern is excellent.
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Double bottom patterns are reversal patterns, a nd they usually precede substantial intermediate or primary trend movement.
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A classic double bottom pattern tends to be defined by high volume on the first bottom, and low volume on the second bottom.
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That's certainly the case here, with GDXJ! Many individual stocks show similar chart formations, which is great news for junior gold stock investors.
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The technical target of the GDXJ double bottom pattern is $75, and the " launchpad" is likely a 3 day close above $55!
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Cheers
St
