Gold, oh how we love it at the tent. So nice to look at, so sweet to hold in our hands. So luxurious to keep in our dreams and yet so dangerous to our trade accounts sometimes. Its baffling and humiliating for quite a few in our ranks. How can something so simple and obvious keep going against us?

LOL….why indeed? Because we forget to do our due diligence and read the damned charts. Thats why! And that is what will make this chart of gold going back 50 years to the 1970’s so interesting to read and yet hard to divine. It looks obvious on its face. But is it beckoning us to open our wallets or sending us scattering like dry leaves in a windstorm?

I would like to start by drawing your attention to the wick under the big yellow arrow. Notice it exceeded the resistance line? Well that tells us two things. First, gold will be going higher at some distant point in the future. And second, price will reverse before that happens. Especially if two wicks are present and the full candle body does not exceed the resistance line. Two wicks is like a double top in this way of reading charts.

That is what I see happening but we won’t know for sure until the candle is fully formed in December this year. So there is 4 months waiting for a verdict on this subject as each candle is 6 months long and we are still in August. Barring that, price could invert, defy gravity and just break out higher. I really don’t see that happening though as gold has already turned in a tremendous performance over the past 3 years.

Anyway, spend a few moments looking at the chart and getting a feel for what comes next. We are certainly at a top of some kind and a pullback is anticipated. But with the world going off the rails in so many ways at once I can’t call it.