This is a MONTHLY chart of Gold over the last 20 years - from the $253 low in Sep 1999 to the $1921 top in Sep 2011 (exactly 12 years). The big picture FIB shows an approximate 50% retracement of that move down to $1046, which is what you should expect over the time period covered (4+ years from Sep 2011 to Dec 2015).
The smaller insert FIB shows the $1921 top down to $1046 that marked the end of the correction and the beginning of the new leg up. Currently, we are right at the 50% retracement of the move from $1046 to $1921 ($1483 or so - spot closing at $1478 and the futures closing at $1483). This time period is exactly four years.
I've been wondering why we have had such a difficult time breaking back thru this level over the last month or so. We overshot the 50% retracement over the summer as is typical with an impulse move of the type we had taking out two plus prior peaks. We have corrected now for nearly four months. Initially, we held above our current level for some time in the $1495-1515 range. Once that failed we searched for a bottom in the $1446 area and have made higher highs and higher lows since that time. We are once again in the 50% retracement area between the floor and ceiling marked by $1446 and $1514 at $1480.
While nobody can predict the future, the backdrop for gold and precious metals is generally very good. Despite all of the risk on mentality going on in the general equity markets, gold has held up surprisingly well. It has been backing and filling on cue with the equity bubble being created that seems almost certain to bust at anytime. Given everything, GOLD seems like as safe a place as you could park your money and protect your wealth. Safe haven assets will be back in favor. Gold is out of the news now. Nobody taking about it anymore (except us). It's all about equities and 3500 price targets for the S&P and $300 plus price targets for AAPL and all of the other names of its ilk.
Technically speaking the chart looks really good. RSI and MACD are moving up and have a long way to run. Look at the double top in RSI that preceded the huge move up and the divergence that was going on at the top. We have a long long way to go and have not even come close to a peak (remember this is a monthly chart and things take a longer time). Look at the three channels in the current leg up. We have held steadily in the top channel of the main channel and within that channel we have made higher highs and higher lows since the $1446 mark. In the smallest FIB chart I have marked the impulse leg that started around $1265 and ended at $1558 from May to Sep (also four months). IMO opinion a definitive close above the $1514 mark will confirm the next leg up is here and for real. Coincidentally that is where we were trying to hold for some time before it gave way to lower prices. Finally, look at the moving averages. The 20 and 50 looking to take out the 100 with 20 leading the way. Interestingly, the thing that struck me was the consistency that the number four popped up (both months and years), and 50%'s (in terms of multiple retracements big, med, and small). I'm not sure what the next four months or four years will hold but my guess is that GOLD is going much much higher. We are 11 years into a bull market that has created more wealth than anyone could imagine. It feels to me like the rug is about to be pulled out from under the masses and that wealth creation process will have to start all over again.
Trust me the smart money is buying gold (and silver ) and loading up on puts in the market. Gold's shining day is coming. Be patient! As Phil Collins said best....."I can feel it coming in the air tonight."
The smaller insert FIB shows the $1921 top down to $1046 that marked the end of the correction and the beginning of the new leg up. Currently, we are right at the 50% retracement of the move from $1046 to $1921 ($1483 or so - spot closing at $1478 and the futures closing at $1483). This time period is exactly four years.
I've been wondering why we have had such a difficult time breaking back thru this level over the last month or so. We overshot the 50% retracement over the summer as is typical with an impulse move of the type we had taking out two plus prior peaks. We have corrected now for nearly four months. Initially, we held above our current level for some time in the $1495-1515 range. Once that failed we searched for a bottom in the $1446 area and have made higher highs and higher lows since that time. We are once again in the 50% retracement area between the floor and ceiling marked by $1446 and $1514 at $1480.
While nobody can predict the future, the backdrop for gold and precious metals is generally very good. Despite all of the risk on mentality going on in the general equity markets, gold has held up surprisingly well. It has been backing and filling on cue with the equity bubble being created that seems almost certain to bust at anytime. Given everything, GOLD seems like as safe a place as you could park your money and protect your wealth. Safe haven assets will be back in favor. Gold is out of the news now. Nobody taking about it anymore (except us). It's all about equities and 3500 price targets for the S&P and $300 plus price targets for AAPL and all of the other names of its ilk.
Technically speaking the chart looks really good. RSI and MACD are moving up and have a long way to run. Look at the double top in RSI that preceded the huge move up and the divergence that was going on at the top. We have a long long way to go and have not even come close to a peak (remember this is a monthly chart and things take a longer time). Look at the three channels in the current leg up. We have held steadily in the top channel of the main channel and within that channel we have made higher highs and higher lows since the $1446 mark. In the smallest FIB chart I have marked the impulse leg that started around $1265 and ended at $1558 from May to Sep (also four months). IMO opinion a definitive close above the $1514 mark will confirm the next leg up is here and for real. Coincidentally that is where we were trying to hold for some time before it gave way to lower prices. Finally, look at the moving averages. The 20 and 50 looking to take out the 100 with 20 leading the way. Interestingly, the thing that struck me was the consistency that the number four popped up (both months and years), and 50%'s (in terms of multiple retracements big, med, and small). I'm not sure what the next four months or four years will hold but my guess is that GOLD is going much much higher. We are 11 years into a bull market that has created more wealth than anyone could imagine. It feels to me like the rug is about to be pulled out from under the masses and that wealth creation process will have to start all over again.
Trust me the smart money is buying gold (and silver ) and loading up on puts in the market. Gold's shining day is coming. Be patient! As Phil Collins said best....."I can feel it coming in the air tonight."