Is gold in Wyckoff accumulation Phase C and ready to rally?
This Point and Figure chart shows that gold may be in Wyckoff Phase C. It is still a little early to say for sure, but there are some positive signs. Supply has been reducing over what looks like Phase A and B, which is consistent with an accumulation structure. There has been reducing supply into the prospective Phase C. If the structure were distribution, we would expect to see supply increasing here. There has also been positive relative strength vs. equities all year.
After a hypodermic top in March, gold has been moving down with pressure from the USD and rising interest rates. However, there are signs that rates may have peaked for the short term. The USD has also shown climactic behavior. Plus, gold is getting a bid from the possible (and likely, in my opinion) general capitulation in equities that is about to happen.
My downside P&F target for the hypodermic top has now been met, so at the very least we should expect some consolidation here. Yesterday's Sign of Strength bar was a hint that demand is coming in. I will be looking closely at any local accumulation structure that is made here, to set targets for the next leg up into a Last Point of Support. What we need to see next is a commitment above 1860 to act as a confirmation.
After a hypodermic top in March, gold has been moving down with pressure from the USD and rising interest rates. However, there are signs that rates may have peaked for the short term. The USD has also shown climactic behavior. Plus, gold is getting a bid from the possible (and likely, in my opinion) general capitulation in equities that is about to happen.
My downside P&F target for the hypodermic top has now been met, so at the very least we should expect some consolidation here. Yesterday's Sign of Strength bar was a hint that demand is coming in. I will be looking closely at any local accumulation structure that is made here, to set targets for the next leg up into a Last Point of Support. What we need to see next is a commitment above 1860 to act as a confirmation.
Comment:
Gold is moving up, but hasn't yet confirmed with that commitment above 1860. Confirmation is important. We may get another test of the low first. I have tentative P&F targets from the cause built thus far, but will wait for the confirmation before publishing them. They could yet grow. Or, the trade may fail. In the words of W.D. Wyckoff, we must "judge the market by its own actions".
Comment:
Gold closed above 1860, but I wouldn't call it a commitment yet. However, the intraday chart suggests that it might push up tomorrow. Let's wait and see.