First of all this is not a short idea. I'm already short in a previous idea and waiting for gold to bottom before closing.
This idea is summarizing what happened during the last half year, and I'm trying to predict a price where gold bottoms in the next 4-5 weeks before breaks out of this multi year consolidation.
Remember that we are starting the times of infation. Greenspan had already started talking about it, when warned that US budget deficit will lead to higher inflation.
If inflation spikes gold will start to rally and stops following cycles.
So when I take profit in my previous gold shorts I will stop shorting gold and gold miners for years.
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As usual I started my short position a bit early, but as I noted I sit this out.
This intermediate cycle was not the one which was to break out of the consolidation.
The next one will do the breakout though.
By today there is no question we printed the ICL on the 16th Aug 2018. It was the annual ( some cycle trader call it a yearly) cycle low too. (In the next weekly idea I will explain to the new followers what is the daily / intermediate / annual cycle low)
The summer drop was a good drop it had all the chances to break above 1400 but it started way too slowly...
After 2 months of the lows we were just 20$ higher and 3.5 months later we were still below 1300... That is not enough for the breakout.
We rallied for 6 months and it was enough only to tag the red upper trendline at 1347$.
Yesterday we broke down the trendline, and today we just sliced through the resistance at 1303 . And as I'm typing this we just broke below the 50 MA.
At the top of the intermediate cycle we printed a trend changing cup and handle formation.
It's right translated , and as we broke below the neckline we lost the possibility of a head and shoulders pattern . A lot of bulls were waiting for a H&S painkiller to get out of the long position but smartmoney didn't allow any exit. The same is true for the bears who closed too early the short positions. There is no discount ticket on this short train for the unpatient traders.
I'm waiting for the break of the previous DCL. The last DCL was a very weak DCL as it was a false breakdown of the triangle pattern. I think it was on the 21st January.
So the minimum where we should drop is the 1270-75 zone.
On the other hand the 38,2% fibonacci retracement is at 1274,1 and if we break that we are going to drop down to the 50% which is at 1252$.
Right now the 200 SMA is at 1247$ and raising every day so it's not impossible that the interemediate low will be printed at the 200 SMA at around 1250-52$.
That is the same level where the 50% FIB retracement is.
This idea is summarizing what happened during the last half year, and I'm trying to predict a price where gold bottoms in the next 4-5 weeks before breaks out of this multi year consolidation.
Remember that we are starting the times of infation. Greenspan had already started talking about it, when warned that US budget deficit will lead to higher inflation.
If inflation spikes gold will start to rally and stops following cycles.
So when I take profit in my previous gold shorts I will stop shorting gold and gold miners for years.
-------------------------------------------------------------------------------
As usual I started my short position a bit early, but as I noted I sit this out.
This intermediate cycle was not the one which was to break out of the consolidation.
The next one will do the breakout though.
By today there is no question we printed the ICL on the 16th Aug 2018. It was the annual ( some cycle trader call it a yearly) cycle low too. (In the next weekly idea I will explain to the new followers what is the daily / intermediate / annual cycle low)
The summer drop was a good drop it had all the chances to break above 1400 but it started way too slowly...
After 2 months of the lows we were just 20$ higher and 3.5 months later we were still below 1300... That is not enough for the breakout.
Yesterday we broke down the trendline, and today we just sliced through the resistance at 1303 . And as I'm typing this we just broke below the 50 MA.
I'm waiting for the break of the previous DCL. The last DCL was a very weak DCL as it was a false breakdown of the triangle pattern. I think it was on the 21st January.
So the minimum where we should drop is the 1270-75 zone.
On the other hand the 38,2% fibonacci retracement is at 1274,1 and if we break that we are going to drop down to the 50% which is at 1252$.
Right now the 200 SMA is at 1247$ and raising every day so it's not impossible that the interemediate low will be printed at the 200 SMA at around 1250-52$.
That is the same level where the 50% FIB retracement is.
Comment:
At the red arrow we had every chance to bounce. But we broke down. That was the point where bulls lost the fight.
The trendline was valid.
The trendline was valid.
Comment:
And here is our 1294$. It is the famous 20$ day just as I thought.
Comment:
I have gold in the 3rd daily cycle on day 29. The last daily cycle of the intermediate cycle is usuay the longest but never the shortest.
So probably this is not going to bottom before the first week of April.
So probably this is not going to bottom before the first week of April.
Comment:
It's done for today.
Comment:
Scalp longs ON.
Comment:
scalp longs OFF
Trade closed manually:
RSI 6
I'M using the simple moving average ( tradingview indicator : "Moving Average"):
50 MA = Blue
100 MA =purple
200 MA =green