It's been a while since I have written an article on Gold, but the recent price action could well be the very clue we have been looking for. I have been very bearish Gold for a number of years/months, month by month the market has slowly moved towards the $1150 target we have been looking for.
You can clearly see its not hearsay, the result speaks for itself, our target was hit this past week, whilst many Gold pundits have been trying to pick a low, we are wavepatterntraders.com stuck to our guns and kept looking lower, one by one the Gold bulls seem to be capitulating, as the market moved towards our long standing target.
We went into this week looking for a low on Gold, with sentiment so bearish it was the perfect setup for us to look for a low and buy those lows, whilst most traders and pundits were bearish we were very bullish and the reversal after a spike lower on Friday was the trigger we want to see to finish off the last few gyrations.
Even CNBC got in on the act and posted silly charts, such it further supported the case to be looking for a low and fade the crowd, doing what we do best, finding low risk setups to make $$$.
So whilst CNBC was making fun of the Gold bulls, members were busy looking to fade the "puking camel" and buy. So far since posting the "puking camel" the market has rallied, time will tell if this proves to be an important low.
We got the reaction to the upside we wanted to see, we think there is a very strong case that wave A and the decline from the 2011 high is finished, although we are looking for any pullback to remain above last week's low. If so it will offer a get setup for more upside.
Readers now can look to buy any pullback that is in 3 waves and stick stops at last week's low, the risk is minimal now; the reward could surprise many that are anti-gold. If wave B has started, we are then expecting to see well above $1400, possibly $1600 over the next few months. We know we are wrong below last week's low.
Until next time,
Have a profitable week ahead.