Every long term chart such as the SPX 500 or Dow Jones has the same historical factor. Once a trend is broken it must retest the support line to decide if there will be a new trend or not. So as we can clearly see in the chart the support was broken. We must retest the support line! Now we will have two factors for the long term. However it is bullish in the medium term. 1. If we break through it the support line shall become resistance. 2. If we don't than we can officially say bearish trend has started.
What if (or when) US raises their interest rate. That will mean a stronger dollars which normally is bad for the gold. I'm not to sure about the gold bullish forecasts in these times..
harryexe
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Yes I agree, something to look out for. However, the dollar has been strengthening aggressively recently and 1250 support holds. As such, I'm bullish biased too.
UnknownUnicorn550984
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Interesting, do you have any statistical analysis to know how often this rule succeeds and fails?
Or how many examples is it based on?
SageinSingapore
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So far all the long term charts I've looked at this is 100% of the time
UnknownUnicorn550984
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that's amazing, how many charts would that be roughly?
SageinSingapore
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I'd would say roughly 4 indexes that I've seen. However I've only looked at 4 charts so this work 4/4 times. But I am confident on this analysis and believe it shall return to 1300+ before deciding which way to go.
UnknownUnicorn550984
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Ok that is showing some promise, but quite a ways to go to be sure of its statistical relevance. I'll keep an eye out for that, thanks for the tip.