Goldtent TA Paradise

I’m using GLD as a proxy for gold price here, and comparing early 2009 to our current position. The similarities are striking. I’ll go through the chart features one by one.

1) Price entered yellow box 1 with an up-down-up-sideways pattern and then exactly the same in box 2.

2) The MA9 approached the apex of the triangle in box 1 acting as support. It’s doing exactly the same now (currently in the 118 area)

3) Importantly, volume rose into the triangle in box 1, then declined as the apex approached. Exactly the same is happening now.

4) The RSI formed a bullish triangle and broke out as the apex approached. It’s doing exactly the same now. Also, note that it’s starting from a lower point, so the RSI upside potential is more than it was in 2009.

None of this guarantees a break to the upside, but it adds a lot of evidence to the bullish case. In isolation, these factors might not mean too much, but when you put them all together…

No charts, just an observation. I was going through some of my old financial records and it just reminded me how terrible the performance of silver has been over recent years.

6th Dec 2010 Gold = £903, Silver = £19

5th Feb 2011 Gold = £878, Silver = £21.87

Today Gold = £963, Silver = £12.39

Since Feb 2011 (in GBP), Gold is up 9% and Silver is down 43% !

The big dollar debate. Dollar dead cat bounce or return of the bull ?

Here are 3 charts for your consideration. The last dollar cycle breakdowns. More specifically, the point at which the 200dma was breached to the downside. In 1985 the 200dma was still rising, in 2002 it was still rising and today it is still rising. The MACD was falling and around -3 in 1985 and -1 in 2002. Today it’s around -1. Stocharstic had fallen sharply in 1985 and 2002, and was bouncing around below 20, today it is doing exactly the same.

Not shown on these charts, but in 1985 and 2002 the TSI had bear crossed weeks/months earlier and was in the -20 area at the point where the 200dma failed . It’s currently at about -20. The TRIX was below zero and declining, like now. %R was below -80 in 1985 and 2002, just as it is now. In short, after looking at numerous indicators, I can’t say for certain that this is just a dead cat bounce, but I can say for certain that all of the indicators are lining up in an almost identical fashion, with almost identical readings and directions of travel as they had in 1985 and 2002 when the 200dma was breached near the start of the cyclical dollar decline.

Just a couple of initial observations

Edit – added MACD support line (just breached to the downside).

Some quick thoughts from me…

Well, for what it’s worth, here is what I think might well unfold…

I certainly hope so anyway. I’m sick of drawing that damn triangle !

You might remember I showed this chart some months back. I thought I’d update it for you. As long as this ratio is trending up, we’re on the right side of the trade (in PM’s). We’ve hit the bottom rail and broken out. This is more evidence that the normal cycle is progressing nicely.

I added the high and low values for gold and started thinking about those numbers and what they’re telling us. Straight away you can see that they’re exponential, not linear. The highs are increasing by an order of magnitude at each peak. the corrections are fairly predictable at almost 50%. This means that if we want to look at where we’re going in the years ahead, we need an exponential (log) view. The symmetry and mathematics are almost too perfect, but that’s not surprising when you think about it. Just look at the graph of US debt – it’s an almost perfect exponential curve. The symmetry, timelines and mathematics all point to around $9000 on the log chart. That is a lot more than the $2470 I calculated and posted a few days ago using a traditional linear chart and the rules of symmetrical triangle breakouts. I think I need to consider this some more, but I guess we’ll know, because my $2470 target would get taken out long before our mid 2020’s peak for this gold bull.

What do you think ? Am I out of my mind ?

On the basis of the last few 15 year cycles, the answer is yes. Notice on the chart below that in the 1980’s the dollars ascent registered a 76 degree angle. In its next bull run in the late 1990’s, it managed to climb at a 56 degree angle. That’s approximately 70% of the previous achievement. The following bull run (just ended), only managed 70% of the last one in terms of it’s angle of ascent – it achieved just 39 degrees. Why does this matter ? Well it’s indicative of a loss of ‘traction’, a loss of energy if you like. Each successive cycle produces a weaker bounce.

We can also see that there is a pretty consistent angle of descent following each bull (58-60 degrees), taking us to the ultimate low. Using this as a guide, and I know this may sound crazy, but it projects a low of somewhere close to 50 in 2025. Beyond that, we might reasonably expect a shallower angle of ascent for 7 or 8 years taking us to a lower high. How low does it need to go before it dies ? I don’t know, but one thing is certain – PM’s will be a good place to be for many years to come.

Here’s the chart

I bought this can of worms at around 50c and got out somewhere around $2.80 if I remember correctly. If you ignore the bearish commentary and focus on the chartology, this looks like a bullish set up. Any piece of positive news on permitting and finding a partner to work with will send it flying again. Maybe worth a small speculative bet. Then again, maybe not !

Another few dollars would make it easier to call but…

Some great gains since I ‘realigned’ my portfolio to give it the Spock touch. Here’s an example – up over 25% today !

This is both simple and astounding at the same time. Simple charting and calculations. Astounding in its implications. A target of $2470, and a likely overshoot to $3000 or so. The miners will increase by multiples on this next bull run. It really does look like the fireworks are about to start. Remember, this analysis, as compelling as it is, needs to be taken in context. A downside break of that $1160-$1180 area will mean that somehow, the Fed has managed to manipulate this thing into oblivion, and the reset will be even more dramatic. Unless that support breaks, this appears to be where we are heading.  Two simple charts. One number from each chart. The numbers match precisely. Coincidence ? I don’t think so…

Edit: I lined the two graphs up so that the starting point (where they overlap) is the beginning of the bull run. They follow each other closely, as you’d expect, until 2011. My contention is that if money creation and debt is rising (in this case in a parabolic fashion), then gold will follow suit. Clearly this has been disrupted since 2011, but there really is no way I can see this situation continuing. It would make no sense whatsoever. Sense and natural forces always reassert themselves. To my mind, there can only be one outcome.

They specialise in the exploration of metals used in Lithium-ion batteries. A Canadian company, with mining interests in Canada, the US and Chile. They’ve had some decent geophysical results from their Chile project http://www.marketwatch.com/story/lico-energy-metals-announces-positive-results-of-geophysical-survey-salar-de-atacama-chile-2017-07-05

An interesting chart, with successive, bullish wedges, or triangles. The largest (blue one), has a very healthy target, but I’m not going to jinx it by putting it down in black and white – one step at a time.

I bow to Graddhys superior knowledge and TA on these but, I had a few spare minutes and did a bit of doodling. Make of it what you will.

All joking (and blue bananas) aside, I think Graddhy is right., We have the next Uranium bull being born here. Buy low sell high ?

The last gold bull went parabolic, with the parabola eventually ‘breaking’ in 2013. The next one (now underway) will also be parabolic in nature. If you want to know why, just take a look at the unit we measure the ‘value’ of gold in – the dollar. That is going parabolic (and not in a good way)…

The US national debt is in a long term, unstoppable parabola. It’s anyones guess how this might end, but this upcoming bust is going to be a doozie.

Anyway, I’ve plotted the gold price in dollars, with a new parabolic uptrend, superimposed the cycles, and come up with a possible ‘road map’. Hope you find it useful…

Had a quick look at the gold chart. Depending on how you draw your line, we are just about breaking out of the symmetrical triangle we’ve been building out since the late 2015 lows. The much larger blue symmetrical triangle will show a breakout near $1300, giving us a target of around $2400. Notice that we can turn down and go below $1200 anytime up until early 2018 without damaging this set up.

A similar analysis of the HUI position gives us an initial target of 450

I thought I’d have a look at the very long term gold chart again and overlay some indicators…

It looks very strongly suggestive of a new, long term bull market being born. Unless any of these very long term support lines are broken to the downside, the strategy has to be long gold and long miners (especially Spocks rocks !).

Interesting read

http://www.marketoracle.co.uk/Article59773.html

Anyone else having problems ?

I like to look at the big picture sometimes – ‘zoom out’, forget the day to day, week to week stuff. Here’s the theory again…

And here’s the mother of all symmetrical triangles…

So what does it mean ? This maybe…

A reminder of what the HUI has done in the past, following such oversold %R positions…

Here’s look at a few  S&R lines and also some indicators…

And finally, a look at the COT position. Just look at the commercials – decreasing short positions and increasing long positions, whilst the specs are doing the opposite !

I think we’re due a dollar bounce, which will coincide with some slight drops and sideways consolidation in gold/silver. As long as the commercial banks don’t dump huge numbers of contracts, we should be ok. If they do, it may still push us to the $1180 area. If that happened I would be very, very bullish. Why ? Because the COT position would be showing the commercial banks with no net short positions, and guess what, they are always on the right side of the bet.

Makes a nice change

First off – how about GDX. Volume declining into the apex and indicators very low. Of course they can stay low for longer as price continues down…

Now the USD/JPY ratio. Volume is rising here, with indicators already high. Traditionally, you see volume decline in a bullish symmetrical triangle, then surge and spike on a confirmed upward breakout.

Heres a chart out of a textbook explaining parabolic breakouts…

Interesting similarity in the current gold chart. Just sayin’…

Will we crash and burn, or is the bull still alive ?

Our patients (PM’s) appear to be on life support. They need to start making a strong recovery soon, or they could be dead in the water for quite some time. I’ve been looking at some individual PM charts, and I’m seeing a mixture of a) bullish inverse head and shoulders b) potentially bullish falling wedges and c) dead ducks. This could turn into a massacre if we don’t turn around soon.  Here are 3 examples that aren’t dead ducks yet.

I’ve also had a look at the latest COT numbers and yes, we are in a position which is supportive of a rally, but it doesn’t guarantee it. The gold price chart viewed on a log scale appears to be resting on its very long term support line. When viewed on a non-log scale you can apply 2 parabolic curves – the first is the actual path taken to the 2011 top and the other is gathering pace on a slower timescale, acting as support. Once again, we’re resting right on that support now.

What does it all mean ? We’re clearly at a major decision point. Much more weakness and the bull case will vanish in a puff of smoke. Golds 8 year cycle, bottoming indicators/CHF-USD ratio, weakening USD and the commercial/speculative positions are supportive of a rally. Others argue the decent US jobs data, rate rises, strong SM and USD-JPY ratio will drag PMs down.

To me, the charts are pointing to an imminent upturn, but some of the arguments against that are convincing. What do you think ?

The bottom rail is currently around $1130…

I posted this chart back in Feb, but it’s still valid. As Fully says, we could be at point(b), with a $200 drop ahead, followed by a 60% rise and then sideways for years (the blue arrow). I prefer the green arrow option, but only time will tell. The other chart is one I previously posted of the CHF/USD ratio. This is one reason I’m expecting the $1180 region to hold, followed by an upside breakout. As ever, I could be wrong.

VIX and market risk diverged in 2011 – just as PMs began to fall. No coincidence.

http://www.zerohedge.com/news/2017-07-05/reason-why-gold-silver-have-frustrated-investors-2011

Can this sucker go any lower ? I foolishly bought a (thankfully small) position at $1, thinking the downside would be limited. Target seems to be somewhere below zero lol.

As always – charts do the talking. Some interesting stuff on symmetrical triangles here http://stockcharts.com/school/doku.php?id=chart_school:chart_analysis:chart_patterns:symmetrical_triangle_continuation

And as always, there is more than one possibility. Hell this is fun 😉