Tronlink Wallet Airdrop: GOLD TREND April 23

April 27
04.00 P.M GMT
Resistance for the remainder of the day is the 1672-1675 area and support is the 1653-1658.

In summary the short term trend is up.

Any pullback next week should find support near the 1650 area.

09.00 A.M GMT
Our opinion is buying gold around 1645.00,
targeting 1681.00, 1694.00 and stop loss 1638.00

08.00 A.M GMT
Long Term=Up (major resistance 1767-1804 needs to be exceeded on a monthly close)
Medium Term=NEUTRAL/BEARISH (Major Resistance 1767 Monthly Close) Very close to turning bearish.
Intermediate Term= Bearish (we remain in an choppy trading range in a downtrend channel)
Short Term= Bullish (a close below 1623 puts the trend bearish)
Support and Resistance for Thursday
Initial Resistance for 1661-1669 and 2nd tier 1681-1688
Initial Support 1642-1651 and 2nd tier 1625-1633

Key Events coming:
Non Farm payroll at 8:30 AM New York time Friday morning.

Recap
CME NEWS

All things considered, the bull camp in gold has to be happy with the price action on Thursday as gold prices managed to rally in the face of disappointing US scheduled data (that is relative to expectations). Gold also held together very well despite noted early weakness in US equities. In fact, June gold managed to overcome slack economic vibes to rally to new highs for the week but the first set of US dataundefinedthe weaker data produced the only minor pullback of the day for gold prices.

June gold was able to reach up to the highest level since April 17th .Some gold bears are hopeful that European debt offerings on Friday morning will rekindle fresh concerns toward Europe, but all things considered, the gold market seems to be setting its own course. Gold’s best pop of the day in New York came at the announcement of better than expected US pending home sales figures around mid morning.

In summary, the gold market built on early strength and finished Thursday's session with nice gains and closed at the highest prices levels since mid April With today's rally, gold has risen more than $35 since yesterday's post-FOMC announcement lows. Higher than expected Jobless Claims numbers provided a large measure of support for gold prices (that was the spin anyway) as recent weakness in US economic data may give the Federal Reserve further incentive to start up fresh quantitative easing measures. After a bit of testing at 1652, the early birds started covering their shorts and price finished near the highs of the day. (1662).

Short-Term
the tick chart below shows today’s move to 1662 and the last resistance line until 1680...

NEUTRAL ZONE ---Price moved above the bull /bear line where that choppy and overlapping structure resides at. How deep we pullback on Friday will depend on how much internal strength gold has. If gold is strong it should hold 1645-1655.

Anytime price is below 1650 MEANS THAT WE’RE back inside the BULL/BEAR zone price range on the chart---and that is where price is vulnerable to going back into the MAJOR CHOPPY action. Price is above all purple downtrend lines and inside the GREEN UPTREND LINES, but just on the edge of the lower one. In order to maintain this new channel price must remain above 1655 on a closing basis. (We’ll allow for a five dollar slippage so make that 1650)

IS THE SHORT TERM LOW IN?. (We’re still using the chart above)

While we are always dealing with odds as there are no absolutes, LOOK AT THE SPIKE LOWS that were all reversed. That means that the control boyz tried to get a sell off going 7 times in the last two weeks but failed on each occasions. It’s important because we keep hearing that China, Russia and India are all standing with buy orders of PHYSICAL in the 1600-1640 area. Could those spikes be confirmation of big hands are pressing the buy button? Regardless, odds favor that the short term cycles have kicked in and favor higher into next week. Like we mentioned, Friday’s have been bad for gold recently so keep that in mind.

If we close below 1640 – we’ll favor that price has returned to the chop scenario and things could get messy again. Any close below 1620 would be a short term cycle failure and would favor 1550-1575. We are not expecting that scenario, but with all the choppy and overlapping and reversals we saw in the last two months, we’ll go on high alert if gold closes below 1640.

Friday will be an important day as we get to see if gold is going to have a normal pullback or if the crash and burn reversal bear traps from the past 6 weeks are still in play. The erratic chop zone is at 1630-1650. –so keep that in mind if you’re trading. FIRST SUPPORT FOR FRIDAY on a pullback is 1642-1652. Resistance is the 1662-1669 and 1681-1688.

Short Term – Short Term Cycles

The Short term cycle has been in play since Monday and is favored higher until the next cycle and that one is due on May 4th (Plus or minus 72 hours).

Gold has one more piece of work to do and that is to get above the upper dotted blue downtrend line. The blue dotted downtrend channel has been resistance since March 1st. More important is that a close above the upper downtrend line would deactivate the lower one. If price doesn’t move out of this channel next week, odds will significantly increase that price is going to go test the lower end. In summary, the next step gold has to do is close above that upper dotted line.

What Next?

Price held above the arc channel on Thursday and rallied. The key is going to be whether price gets above these key resistance lines at 1662 -1666 on Friday. Its best to remain cautious until we get that close above. With NFP report in the morning look for a mild pullback and then some choppy range bound trade into the report. Let’s hope the pullback is controlled and doesn’t plunge.

Odds favor sideways action into the NFP ---- a little in price and then a bounce towards the noon hour in New York. The last two hours of the day isd the unknown as to whether we weaken like we have on Fridays lately.

Bottom Line

Gold moved up on Thursday but there is still work to do on an a medium term basis. On the short term Watch the 1660-1665 area as the price to get above to continue this short term trend. Odds favor that if we don’t exceed it on Friday, we should do so on Monday.

04.00 A.M GMT

SPOT GOLD closed higher on Thursday and the highrange close sets the stage for a steady opening on Friday. Stochastics and the RSI remain neutral to bearish signalling sideways to lower prices are possible nearterm. If it renews the decline off February's high, the 75% retracement level of the DecemberFebruary rally crossing is the next downside target. Closes above the reaction high crossing are needed to confirm that a shortterm low has been posted.

02.00 A.M GMT

Gold prices rose around 0.2 percent today on the back of weakness in dollar index, as a weaker dollar makes dollar denominated commodities look attractive for holders of other currencies.
Gold almost paused near 1645 after yesterday’s volatile session following the US Fed chairman’s Bernanke’s comments over US economy. US Fed’s two-day meeting ended yesterday without providing solid cues for another round of monetary easing. US dollar edged down to a three week lows against a basket of currencies after the Fed announcement. At the same time FOMC kept the interest rates unchanged at 0.25 percent and gave indications to maintain the rates at least till the end of 2014.

The sentiment in trade was upbeat after, Federal Reserve Chairman Bernanke signaled that it would keep its doors open to the possibility of further easing, in case the economy tails off, and sounded optimistic about the U.S economic recovery. The U.S jobless claims continued to disappoint completing a recent string of muddled economic reports from the US. With the housing sector showing signs of stabilization, the U.S pending home sales figures further vindicated this revival. ( a small bright spot )

However, housing sector in the U.S has a long way to go till it is seen as fully recovered. With the Chinese economy going through a lean patch, a possible Chinese Central bank liquidity action in coming days cannot be ruled out entirely. Such an act could have a real impact on the demand for commodities. The U.S annualized GDP numbers on Friday will be another key event, which could further entice market forces amid a recent string of cluttered economic figures.

Economic Events scheduled for April 27, 2012
that affect the European and American Markets
06:00     EUR       Gfk Consumer Confidence Survey
The GfK Consumer Confidence is a leading index that measures the level of consumer confidence in economic activity. A high level of consumer confidence stimulates economic expansion while a low level drives to economic downturn
TBD     GBP       Nationwide Housing Prices
The Nationwide Housing Prices shows the value of the houses prices in UK and indicate current movements in the housing market that is considered as a sensitive factor to the UK’s economy.
TBD     GBP      Nationwide Housing Prices
The Nationwide Housing Prices shows the value of the houses prices in UK and indicate current movements in the housing market that is considered as a sensitive factor to the UK’s economy.
09:00      CHF       KOF Leading Indicator
The KOF Swiss Leading Indicator is released by the Swiss Institute for Business Cycle Research and it’s a joint survey with leading indicator which measures future trends of the overall economic activity. It captures the movement of GDP growth and the economic trend in Switzerland
12:30     USD       Gross Domestic Product Annualized
The Gross Domestic Product annualized released by the US Bureau of Economic Analysis shows the monetary value of all the goods, services and structures produced within a country in a given period of time. It is a gross measure of market activity because it indicates the pace at which a country’s economy is growing or decreasing.
12:30     USD       Gross Domestic Purchases Price Index
The GDP Price Index released by the Bureau of Economic Analysis, Department of Commerce gauges the change in the prices of goods and services. Changes in the GDP price index are followed as an indicator of inflationary pressure that may anticipate interest rates to rise.
12:30     USD       Real Personal Consumption Expenditures
The Real Personal Consumption Expenditure released by the US Bureau of Economic Analysis is an average of the amount of money the consumers spend in a month on durable goods, consumer products, and services.. It is considered as an important indicator of inflation.
13:55     USD       Reuters/Michigan Consumer Sentiment Index
The Reuters/Michigan Consumer Sentiment Index released by the Reuters/University of Michigan is a survey of personal consumer confidence in economic activity. It shows a picture of whether or not consumers are willing to spend money

April 26
03.00 P.M GMT

Gold still needs to close above the upper channel line in the 1662-1665 area to confirm the short term cycles have bottomed. However, yesterday’s reversal back up was the 2nd time this week and it favors that the short term cycles have bottomed and a bounce into next week is underway. Resistance for the remainder of the day is the 1662-1665 area and support is now the1642-1648 area.
We favor gold to move higher into next week. It’s possible that gold will peak at the upper trend line today and if we get a pullback to the 1642-1645 area, we might look to get on board with a short term trade.
We favor a bounce is underway, the 1660-1665 area and the 1681-1688 area will be the two resistance points to watch for and exceed. As long as price closes are above 1638-1640, the short term trend favors a bounce into May is underway.

08.00 A.M GMT
WATCH 1652-1655 as FIRST SUPPORT ON Thursday

from where a pullback can begin and retest the 1633-1641 area.

Long Term=Up (major resistance 1767-1804 needs to be exceeded on a monthly close)
Medium Term=NEUTRAL (Major Resistance 1767 Monthly Close) Very close to turning bearish.
Intermediate Term= Bearish (we remain in an choppy trading range in a downtrend channel)
Short Term= Bullish (Short term cycles look like a bottom)
Support and Resistance for Thursday
Initial Resistance for 1652-1655 and 2nd tier 1666-1675
Initial Support 1633-1642 and 1616-1626

Key Events coming
Options expiration on 4/27 for Gold and Silver;(Gold expiration not a big contract month)
India festival April 24th- Akshaya Tritiya, underway.

Recap

Gold stayed in its trading range as expected until the FED minutes were released showing almost nothing different from the last set of minutes. Concerns about Europe, the economy, no inflation, and that rates would stay the same didn’t matter, gold moved from 1640 to 1625 in a few seconds on the 100 OZ contract and the mini 33 ounce gaped to 1615 a full 10 dollars lower on the spike. The big contract held the Monday lows by a few dollars and kept the short term cycle window low of Monday still in play.

We came into today unwilling to play in front of Bernanke and he did not disappoint. Here’s how it looked on Kitco’s website and once again the 1625 area held. The 2nd tier support listed on the weekly page for this week was (1612-1625) and that area has now reversed back up to 1640-1650 twice and that gives it “GOOD “ support for the short term. The chart shows the entire drop was basically

Orders for U.S. durable goods fell in March by the most in three years, indicating manufacturing will contribute less to growth this year. Bookings for goods meant to last at least three years dropped 4.2 percent, the biggest decrease since January 2009, after a revised 1.9 percent gain the prior month, data from the Commerce Department showed today in Washington. Economists forecast a 1.7 percent decline, according to the median estimate in a Bloomberg News survey.

One would think that markets would have sold off on the news but it barely yawned. It was much more fixed on what Bernanke was to say. It’s a strange world when markets ignore key economic news and rather stay focused on what the latest ‘spin’ and provided “juice” for the market that Ben would offer up. Perhaps the yawn is due to the fact that 84% of all trading is now computer on the stock exchange and only 16% by human means. Fascinating to say the least. Mortgage applications fell 3.8% in a housing market that didn’t pay attention either.

Short-Term (Traders)

the chart below shows the action since the 1681 high and the 1612 low point. It is not a TIME chart –it is tick chart and therefore removes the long overnight session patterns with low volumes and instead 25 contracts must trade for a bar to appear. The chart looks very busy but it’s easy to break down. It’s how to view if we are transitioning out of a downtrend into an uptrend.

NEUTRAL ZONE ---The bull/bear zone is the battle for control of the market and the choppy mess we’ve been in and basically no man’s land. If price CLOSES above then the bulls have the advantage a price CLOSE below and the bears have the advantage.

The purple Channel lines define the downtrend channel. There’s a lower, mid and upper purple line. The lower line has a white dotted line and together they make the support zone where price plunges have supported. The MIDWAY Channel is the line that separate the downtrend channel into an upper and lower range. Right now price has established CLOSING support above this line and is poised to go test the upper purple line---which is the only downtrend line left for price to close above at the 1652-1655 area. A move and close above there is the neutralization of the downtrend we are in and step one in price reversal. THUS A MOVE ABOVE 1655 neutralizes this downtrend.

IN SUMMARY – price needs to get into the GREEN uptrend lines and out of the down trending purple channel lines. The 1648-1655 area is where the SHORTS will try their hardest to hold price. Look at all the big spikes down that have been attempted . Each one has been reversed. Today’s reversal might have been the last gasp for the shorts. If they can take it below 1620 after four raid attempts that are on this chart, it will be surprising.

THE only other downtrend line to watch for now is the RED MARCH DOWNTREND LINE at 1665.

The GREEN channel lines are for the uptrend boundaries to establish themselves. The lower Green line is also at the 1650-1655 area making that price point even more important and if we begin to support on that lower green line then an uptrend attempt will officially begin with a goal of 1665 and 1681-1688 as first targets. Finally and blue horizontal channel lines is for the trading range we have been in 1681-1688 on the upside and 1612-1620 on the downside.

The upper purple puts first resistance on Thursday at 1652-1655. With last week’s high at 1660 and the 50 day average at 1666 that puts 2nd resistance at 1660-1670. A move above THE UPPER PURPLE downtrend line at 1652-1655 favors 1660-1670 as a favored target. With options expiration day having the most open interest at 1675 and silver at 32.50, it will be interesting to see how much power the ‘control boyz’ have. Any pullback to the midway purple line or the low end of the bull/bear zone at 1634 should give us support if the cycles have turned up and price has no business below that area. Today’s reversal back up for the 2nd time this week favors that the Monday Low at 1623 and during the short term cycle window was the low for April and that any move above 1652-1655 should favor a move higher to the May 4th time frame.

THE GOLD 33 MINI OZ CONTRACT

Yesterdays update listed The FED FOMC MEETING and the BERNANKE SPEECH spike upside resistance at 1675-1681 and the final sentence on this portion of the update listed “the 1617-1625 area on any hard break down”

The low was 1626 on THE COMEX and 1616 on the 33 OUNCE MINI LIFFE contract.
That was a 10 dollar difference in PRICE LOW !!!! Whenever you see such a difference MAKE A NOTE OF IT as it serves two purposes. First that the odds that a flush out short term low was made is MUCH GREATER than normal and two, ANY PULLBACK OR NEW LOW on the COMEX contract should be in the same VICINITY of the mini low. In this case that would be 1615.

Now that the speech is out of the way, and the stops have been flushed out in gold, silver and gold stocks, the potential for the short term cycles to move higher and the seasonal to kick in is not only the odds favorite but it is a double edged sword also. If we don’t turn here and now fail the lows, then a hard move down will be in play and we would expect a move towards 1500-1550. We don’t think that is the case but we need to see the follow through on price now and get beyond 1655-1666.

In summary, the market has given its best signal of a price low is in place by holding above the Monday CYCLE low and reversing back above 1644. Odds favor higher into the end of the week.

With the short term cycles due to turn and the overdue seasonal and oversold condition, price is ripe for a turnaround but still needs price to begin an uptrend. The wildcard continues to be the ever growing crisis in Europe where the Dutch Government is the latest entry. The Cabinet offered their resignation on Monday. Gold will react negatively on any increasing angst from that region. We thing it all comes down to the Bernanke Speech and that is what should contain gold until noon Wednesday. With mid-week Wednesday, it does hold the potential for a price high for the week. Gold should be kept at the 1650-1660 area until the FOMC meeting. On the downside, 1635-1640 is a potential low until the meeting, but so is the 1617-1625 area on any hard break down. Let’s go to the cycles.

Short Term – Short Term Cycles

The Short term cycle window is closed and the next two week trend is favored to be in play. Today’s sell off was two dollars higher than the cycle window low of 1623.

Yesterdays reversal lower to a new weekly low and then a close back on the highs gave us a reversal bar and with Tuesday’s move to just under the upper dotted blue trend line, it is having a strong potential that the cycles are showing its effect and is tilting towards the upside. Gold still has work to do and that is to close above the dotted blue downtrend line and above last week’s high. Thus a close above 1660 would favor the short term cycle is in play and a move into the May 4th time frame will be favored.

In summary, price needs to move above the blue dotted trend line as the next step to confirm the short term cycles that were due to bottom have taken hold. Now gold needs to get ABOVE THE DOTTED BLUE UPPER TREND LINE and we favor higher.

Wednesday’s drop held the Monday low in GOLD so the cycle is still valid. SILVER MADE A NEW LOW TODAY – and if WE HAD NOT CLOSED on the highs of the day, I would be much more concerned about it.

What Next?
Mid week Wednesday gave us our low and reversal.

The Gann angle red arc was penetrated but price closed back above the ARC and keeps the upside potential alive for a bounce rally. We need to CLOSE ABOVE 1640 on THURSDAY to keep the arc support alive. Resistance will be next at the 1660-1666 and the 1681-1688 area. As long as we can stay on a close above 1642 we have a shot at the upside. WATCH 1652-1655 as FIRST SUPPORT ON Thursday from where a pullback can begin and retest the 1633-1641 area. As long as we don't move below 1617, a turn potential is in play. A move above that green resistance area favors a test of 1680-1720.

GOld price chart with Gann Angles and Arc's

Bottom Line

EVERYTHING IS IN PLACE NOW FOR A TREND MOVE that would last into the first week of May –and price looks ready to confirm. Now price has got to follow through higher.

The next short term cycle is underway. We need a move out of this area and an end to this crazy choppy death trading chop pattern.

The ZOOM IN on today’s drop shows a 8 minutes to drop and only 16 minutes to reverse and be higher than where the drop started. There’s even an INVERTED head and shoulder at the bottom pattern. This highly favors a LOW WAS MADE and the cycles are going to turn up. Support for Thursday looks to be 1634 or 1638-1640. This pattern is the best chance for a low since the correction began from 1681. IF THAT IS THE CASE and the short term cycle has kicked in, then price has no business below 1630-1635 and 1655 should be taken out on Thursday or Friday the latest. A pullback to 1630-1635 should be maximum pullback –otherwise something is wrong. Barring that pullback, odds favor higher above 1655.

03.00 A.M GMT
First resistance will be the 1642 - 1647 area . IF we can get above these resistance lines just above 1652-1655 it will be the first signal that the short term cycles are taking hold.

01.00 A.M GMT

Economic Events scheduled for April 26, 2012

that affect the European and American Markets

TBD     EUR      Consumer Price Index (YoY) (Apr)
The Germany consumer price index released by the Statistiches Bundesamt Deutschland measures the average price change for all goods and services purchased by households for consumption purposes. CPI is the main indicator to measure inflation and changes in purchasing trends.
TBD     EUR      Consumer Price Index (MoM) (Apr)
The Germany consumer price index released by the Statistiches Bundesamt Deutschland measures the average price change for all goods and services purchased by households for consumption purposes. CPI is the main indicator to measure inflation and changes in purchasing trends
06:00     EUR       Retail Sales (MoM) (Mar)
The Retail Sales released by the Statistiches Bundesamt Deutschland is a measure of changes in sales of the German retail sector. It shows the performance of the retail sector in the short term. Percent changes reflect the rate of changes of such sales. The changes are widely followed as an indicator of consumer spending
06:00      EUR       Retail Sales (YoY) (Mar)
The Retail Sales released by the Statistiches Bundesamt Deutschland is a measure of changes in sales of the German retail sector. It shows the performance of the retail sector in the short term. Percent changes reflect the rate of changes of such sales. The changes are widely followed as an indicator of consumer spending.
08:30      GBP        BBA Mortgage Approvals (Mar)
The Mortgage Approvals published by the British Bankers’ Association (BBA)measure the number of home loans issued by the BBA during the previous quarter. It is considered as a leading indicator of the UK Housing Market. A Mortgage growth represents a healthy housing market that stimulates the overall UK economy
09:00      EUR Consumer Confidence (Apr)
The Consumer Confidence released by the European Commission is a leading index that measures the level of consumer confidence in economic activity. A high level of consumer confidence stimulates economic expansion while a low level drives to economic downturn.
09:00     EUR       Economic Confidence (Apr)
The Euro Zone Economic Confidence released by the European Commission is a survey of consumers confidence in economic activity. It indicates the trend of the overall Euro Zone economy.
09:00      EUR        Industrial Confidence (Apr)
The Industrial Confidence released by the European Commission is an index that measures the level of industrial executives confidence in economic activity. The survey asks about orders and buildup of inventories. A high level of industrial confidence stimulates economic expansion while a low level drives to economic downturn.
23:01      GBP       Gfk Consumer Confidence (Apr)
The GfK Group Consumer Confidence is a leading index that measures the level of consumer confidence in economic activity. A high level of consumer confidence stimulates economic expansion while a low level drives to economic downturn.

April 25
01.00 P.M GMT

Gold Trades Above $1640 Before Fed Statement

The green currency is estimated to remain under
pressure till the Fed statement as announcing
QE3 means excess supply in markets and
thereby depreciation in value.

Gold steady above $1640 an ounce on Wednesday trading before the Fed's two-day meeting starting today.

Yesterday, gold prices were boosted by the rise in equities after upbeat earnings, yet the main focus today will shift to the Fed statement on monetary policy which will include the latest growth, unemployment and inflation forecast later in the week.

The Fed is predicted to keep their pledge to keeping interest rate near zero and may give some hints to the possibility of extending stimulus to bolster the easing recovery.

Data from the U.S. released yesterday came disappointing as it showed a drop in consumer confidence to 69.2 in April from a revised of 69.5 while new homes sales plunged 7.1% from a revised of 7.3% advance.

The data affected the dollar negatively as it increased speculations the Fed may refer to possible extension to quantitative easing on signs recovery is waning, especially as the most recent data came below analysts' forecast.

The green currency is estimated to remain under pressure till the Fed statement as announcing QE3 means excess supply in markets and thereby depreciation in value.

The U.S. dollar slipped today against a basket of major currencies as depicted by the dollar index, where the breach of support at 79.30 yesterday paved the way for the drop to 79.15.

The shiny metal, however, may come under pressure from political worries in France and Netherlands amid worries new governments may affect commitment to budget cuts.

In Netherlands, the biggest opposition parties refused to support austerity measures needed to meet EU budget goals, while in France Presidency candidate Hollande's advance in elections is threatening his country's pledge to keep austerity plans.

The yellow metal is currently trading around $1642.70 an ounce coming back above strong support of $1640 after finding support at $1630 levels yesterday.

Crude oil for June's delivery is meanwhile steady to trade around $103.77 a barrel after opening today's trades at $103.74.

08.00 A.M GMT
A Bernanke spike up should find resistance in the 1675-1681 area or

the 1600-1620 are depending on the ‘control boyz’ desire.

Long Term=Up (major resistance 1767-1804 needs to be exceeded on a monthly close)
Medium Term=NEUTRAL (Major Resistance 1767 Monthly Close) Very close to turning bearish.
Intermediate Term= Bearish (we remain in an choppy trading range in a downtrend channel)
Short Term= Bearish (Short term cycles due to bottom – but still bearish)
Support and Resistance for Wednesday
Initial Resistance for 1652-1655 and 2nd tier 1666-1675
Initial Support 1627-1637 and 1590-1605

Key Events coming

WEDNESDAY --- FOMC MINUTES RELEASE AFTER 12 NOON NY TIME – BERNANKE SPEECH 2PM NEW YORK TIME. The last two ‘events’ drove gold down 100 and 60 dollars respectively. At that time gold was at its high point on the range. That will not be the case on Wednesday. At the moment gold is near the middle of the range.

FOMC Meeting Two-day meeting, April 24-25. Get ready for a gold move in one direction or another. If Options expiration optimum is 1675 gold and 32.50 silver – will Bernanke say something that the “control boyz” can use to achieve these prices ?

I have often maintained that the control boyz are allowed to move price to options expiration for maximum gains as they use the profits to manipulate the market (and take losses when trying to control gold) It is pure speculation on my part---but markets move to the these optimum levels at each expiration. There must be something behind this scenario. I think they use the money to make up for the losses on short positions. Again---pure speculation on my part.

Options expiration on 4/27 for Gold and Silver;(Gold expiration not a big contract month)

India festival April 24th- Akshaya Tritiya, the third day of the new moon of Vaishakh month (April-May), is considered one of the four most auspicious days of the Vedic Calendar.

Recap

Gold futures gained on Tuesday, as a pause in the escalation of concerns about Europe's debt crisis drew buyers to the precious metal. The most actively traded contract, for June delivery, rose $11.80, or 0.7%, to $1,644.40 a troy ounce on the Comex division of the New York Mercantile Exchange. European markets were calm on Tuesday after being rattled Monday by a series of warning signs on the euro-zone's political and financial stability. But relatively well received auctions of Dutch, Spanish and Italian debt helped steady investor sentiment on Tuesday, drawing buyers to growth-sensitive assets and weighing on the U.S. dollar.

Short-Term

the chart below shows the action since the 1681 high and the 1612 low point. The purple Channel lines are the downtrend lines. The GREEN channel lines are for the uptrend and the blue horizontal channel lines is for the trading range.

The upper purple puts resistance on Wednesday at 1652-1655. It is the last down trend resistance line to watch. With last week’s high at 1660 and the 50 day average at 1666 that puts 2nd resistance at 1660-1670. THE UPPER PURPLE downtrend line at 1652-1655 is the most important point to either resist or form support from which to move higher on.

The MIDDLE PURPLE channel is where price is trying to build support. Thus 1633-1640 IS FIRST Support on Wednesday resides. That is followed by stronger support at the lower purple channel line and white dotted line at the 1616-1625 zone for Wednesday. That is the daily support. Weekly support (not shown on this chart is the 1575-1588 area).

On the upside and in order to establish any kind of uptrend is the GREEN channels. Today’s high pierced above the lower green channel line, cleared the 1650 stops but could not keep above it. It also pierced the 1650-1655 bull bear line but could not remain above. Note how the pullback so far is holding white line 1635-1640 where the middle purple downtrend line just happens to be crossing. This is where gold is trying to establish support for Wednesday. A failure to hold that area will keep gold in a downtrend. The 1635-1645 area is no man’s choppy land and can go either way. The 1650-1655 area is Transition from downtrend to uptrend and above 1655-1660 is where uptrend tries to establish itself. The market can test these zones but that’s not what’s important. It’s when the price pulls back and SUPPORTS above the NEW TREND LINES. One caveat for Wednesday is the FED FOMC MEETING and the BERNANKE SPEECH. These lines will be useless on spikes during the speech but as soon as the market settles down then we can see if the uptrend or downtrend channels begin to support. Finally – A Bernanke spike up should find resistance in the 1675-1681 area or the 1600-1620 are depending on the ‘control boyz’ desire.

In summary, the market is trying to go from downtrend to uptrend. With the short term cycles due to turn and the overdue seasonal and oversold condition, price is ripe for a turnaround but still needs price to begin an uptrend. The wildcard continues to be the ever growing crisis in Europe where the Dutch Government is the latest entry. The Cabinet offered their resignation on Monday. Gold will react negatively on any increasing angst from that region. We thing it all comes down to the Bernanke Speech and that is what should contain gold until noon Wednesday. With mid-week Wednesday, it does hold the potential for a price high for the week. Gold should be kept at the 1650-1660 area until the FOMC meeting. On the downside, 1635-1640 is a potential low until the meeting, but so is the 1617-1625 area on any hard break down. Let’s go to the cycles.

Short Term – Short Term Cycles

The Short term cycle window is closed and the next two week trend is favored to be in play. Yesterdays reversal lower to a new weekly low and then a close back on the highs gave us a reversal bar and with Tuesday’s move to just under the upper dotted blue trend line, it is having a strong potential that the cycles are showing its effect and is tilting towards the upside. Gold still has work to do and that is to close above the dotted blue downtrend line and above last week’s high. Thus a close above 1660 would favor the short term cycle is in play and a move into the May 4th time frame will be favored. Keep in mind that Bernanke can throw a wrench into this scenario, but the control boyz would like to see options expiration at 1675 gold and 32.50 silver. This rise would play well with the short term cycles and the seasonal that is so overdue.

In summary, price needs to move above the blue dotted trend line as the next step to confirm the short term cycles that were due to bottom have taken hold. The Tuesday action was positive but not enough to add to the odds.

Those odds favor a trend change due to seasonal, cycle, and oversold condition. But this choppy mine field for trading also suggests we need confirmation. Every other day it looks like the low is in and price gets reversed every day. We need to exit this downtrend channel and get rid of the chop in order to have a trade that won’t drive us crazy and give us some trending action. Wednesday will be the most important day of the week. If it weren’t for the FOMC Bernanke speech, we’d feel much better favoring the upside. But speech aside, the odds have the upside as the advantage but it takes a close above the upper dotted line to show that PRICE also is reacting to the short term cycle and potentially to the India festival, and the upcoming options expiration as the open interest is in the 1675 area in gold so it would be to their benefit to see higher. The FOMC speech could drive prices much higher on Wednesday, but the risk is too much for my taste to walk in front of it. When the next solid trend takes hold, it will last more than a few days and I’ll look to hop on.

Upon close inspection---although price is still in the downtrend channel it really has moved to a sideways pattern and is hanging around the upper trend line on the ABOVE chart. A close above the upper downtrend line will increase the odds to 75% that the next short term move is up.

Now that the short term cycle window is closed we have the reversal day yesterday and a higher high on today’s bar. The upside potential is increasing and a Bernanke flip could send prices much higher or lower. It really sucks trading with them as it makes the RISK SO BIG it’s better to wait for them to get it over with and then look for an entry. While it may have to be 20 and 30 dollars higher the risk of holding a long position in front of them was 100 dollars on Feb 29th and 60 dollars on the last speech. So it doesn’t make it better by any means. From a trader standpoint its damned if you do and damned if you don’t. From a DOLLAR LOSS PERSPECTIVE – it really is better waiting and paying a higher price if the control boyz take it higher.

What Next?

We enter mid-week Wednesday with a lot on the line in regards to short term cycles and price supports. There is no trend to trade just a choppy tight slowly descending downtrend. With Bernanke on tap to speak one can only speculate as to what he will say and how the ‘control boyz will use it on gold price. My own though is he has to hint “JUICE” for the markets, especially equities where the pension funds and tax return money is about to enter the foray for the year. Price is usually contained to first support and resistance before the FOMC meetings so the 1650-1655 area should be top end until the meeting. Anything goes during it. Spike high resistance is the 1666-1676 area on the upside and 1612-1625 on the downside.

The Gann angle red arc is trying to hold price on its inner band. The WEEKLY SUPPORT is at the 1580-1600 area and the weekly resistance is 1681-1688.

Bottom Line
THE FED FOMC SPEECH on WEDNESDAY will be watched by all markets.

EVERYTHING IS IN PLACE NOW FOR A TREND MOVE that would last into the first week of May --- all we need now is for price to agree and SHOW that it is reacting and on which side. Until then, we can’t eliminate the downside and will continue to respect it as the trend remains down. It’s been a difficult two months now, and a time when it’s easy to lose money trading as there is no trend and the FOMC comes up every time we get near a breakout. As hard as it is, it’s better to wait for a trend to develop then to trade this pattern. The next cycle is underway. Once the FOMC is out of the way, it should hopefully set a trend in motion. We’ll try and get on it if wants to start trending.

The cycle window is now closed on the short term cycles and any close now below Monday’s low will introduce a whole new set of problems for the short term.

On the upside we need to get back above the lower green channel line and support on it and then exceed that top down rending purple line under 1650. The 1640-1650 area is no man’s land where all that messy chop is on the chart below. That is where the downtrend channel and uptrend channels are crossing.

Under 1635 and the downside becomes a worry. On the upside, above 1653-1655 and the upside gains traction. Now it’s up to BEN and GOLD as to which way we move out of here. When it does, I’ll look for a set up to try and hop on to.

04.00 A.M GMT

Gold prices rose on Tuesday as a softer tone to the dollar and news of more central bank buying stopped the previous session’s slide, but traders largely stuck to the sidelines ahead of a key monetary policy meeting of the US Federal Reserve.

The main event this week—the Federal Open Market Committee meeting/Ben Bernanke press conference—kicks off today and concludes tomorrow, which may overshadow [other] releases.

The Federal Open Market Committee is expected to only tweak its economic forecasts at its two-day meeting this week, keeping all its options on the table given cross currents in recent economic data, analysts say.

The precious metal has shed more than 2% of its value so far this month after declining in both February and March, hurt by a 1,3% rise in the dollar as the worsening euro zone debt crisis knocked the euro.

But gains in the dollar have proved fragile, with the euro clawing back some of the previous session’s losses on Tuesday to rise 0.4%, as a debt sale in the Netherlands produced solid results even a day after the Dutch government collapsed.

The story for gold is unchanged, whether you’re looking at the fundamentals, which have underpinned the market from the year 2000, or the premium on gold attached to the economic crisis.

The dollar is coming out of the mire first, and that has weighed on gold and on speculators’ patience, but on a longer-term view, nothing has changed.

Economic Events scheduled for April 25, 2012
that affect the European and American Markets
09:30     GBP       GDP (YoY)        0.3%        0.5%
Gross Domestic Product (GDP) measures the annualized change in the inflation-adjusted value of all goods and services produced by the economy. It is the broadest measure of economic activity and the primary indicator of the economy’s health.
11:00      GBP        CBI Industrial Trends Orders -20    -8
The Confederation of British Industry (CBI) Industrial Trends Orders measures the economic expectations of the manufacturing executives in the U.K. It is a leading indicator of business conditions. A level above zero indicates order volume is expected to increase; a level below zero indicates expectations are for lower volumes. The reading is compiled from a survey of about 550 manufacturers.
13:30      USD       Core Durable Goods Orders (MoM)       0.5%      1.8%
Core Durable Goods Orders measures the change in the total value of new orders for long lasting manufactured goods, excluding transportation items. Because aircraft orders are very volatile, the core number gives a better gauge of ordering trends. A higher reading indicates increased manufacturing activity.
13:30      USD       Durable Goods Orders (MoM)       -1.5%        2.4%
Durable Goods Orders measures the change in the total value of new orders for long lasting manufactured goods, including transportation items.
17:30     USD Interest Rate Decision
Federal Open Market Committee (FOMC) members vote on where to set the rate. Traders watch interest rate changes closely as short-term interest rates are the primary factor in currency valuation

April 24
08.00 P.M GMT
Odds favor 1650-1653 as today’s high point.
Watch the 1635-1640 area on pullbacks.

The gold market appears to be facing a marginally improved outside market environment today, as equities are generally higher and for the time being it would seem like panic toward the Euro zone debt situation subsided.. Dutch debt auctions this morning failed to float all the debt offered, but the yields were acceptable and that was accompanied by a similar acceptable auction result from Italy. CDS rates were narrowing but many traders are suggesting that is merely the result of a significant ramping up of the CDS rates yesterday. With somewhat supportive dollar market action and some gains in other metals prices this morning, the bear in gold doesn't have a number of other markets working in its favor today. The 1650-1655 area is the most important support of the day to watch for at the moment.

The gold market might draft some support from news that Mexico and Russia increased their gold and currency holdings, but the real focus of the gold trade recently has been on worldwide investor demand and perhaps not as much on central bank demand. From the gold production front, the news was mixed overnight as a couple sizable gold producers reported a decline in output, while a smaller producer reported an increase in quarterly gold production.

Perhaps some of the improved attitudes overnight are in anticipation of the beginning of the US FOMC meeting, but skirting a series of European debt auctions, with acceptable results, has to favor the bulls, as many markets were seemingly factoring in the prospect of serious trouble.

The US economic report slate today was rather active, with a home prices (DOWN 3%), New Home sales (down 7%), Consumer Confidence (pretty much unchanged at 69.2) and a Richmond Fed showing mixed data.

Equity markets in Asia were weaker to start, but the Hong Kong market eventually managed a minimal gain. European markets were a little higher to start today, as CDS rates in the region were coming down and debt auctions overnight failed to whip up panic again. However, European corporate earnings have generally continued to disappoint investors, especially when compared to year ago results. Early in the US trade today, share prices were higher, with the markets apparently breathing a little easier in the wake of this morning's European debt news and economic results that weren’t outright bearish. While the FOMC meeting officially begins today, the market doesn't expect any specific news from that front until early Wednesday afternoon.

Gold Going to the Chart

So far the short term trend change due to begin has lifted gold from the 1625 low to 1650. There are two CHANNELS appearing on the chart. We have the downtrend purple channel which provided support on the low end yesterday and a GREEN CHANNEL that is an uptrend channel that was violated on Mondays drop. Today’s move up to 1650 reached the lower GREEN channel line and found resistance there. A close above this channel line would ADD to the prospect that the Monday low could be the launch point for the short term trend change that was due April 20th (plus or minus 72 hours). Yesterday’s low on the 23rd qualifies as the potential low and now we need to see gold close above and start to SUPPORT the GREEN channel on the chart below.

The one major concern is the FED FOMC statement on Wednesday. This might keep gold contained and depending on what Bernanke says – short term trend or not – could bring in volatility. But that could also be an upside move as well. Whatever he says---the market will spin it the way they want.

Support for the remainder of the session is the 1635-1640 area and resistance is the 1651-1654 area. In summary, we have our first evidence that a low may have developed but there is still work to do for gold and the FED meeting is a major concern. Options expiration has 1675 in gold and 32.5 in silver where the most open interest resides and where the control boyz would be served. Perhaps the Bernanke will provide “words” to achieve such a move. IN SUMMARY – If we begin to hold 1651-1653 it will favor higher. PULLBACKS that hold 1635-1640 might provide a good spot for a short term trade – but the danger will be the FED meeting. The one thing that is different is gold is at a LOW point prior to this FED meeting whereas the last two had gold at the highs.

WE NEED TO SEE THAT GREEN CHANNEL PROVIDE SUPPORT --- or gold hold on pullbacks to 1630-1640. Thus it looks like gold is trying to turn here but has not confirmed the upside just yet. Odds favor 1650-1653 as today’s high point. Watch the 1635-1640 area on pullbacks. The downtrend channel (purple) still has a slight advantage. We’ll be watching this pullback to see if wants to hold. If it does, a two week uptrend should be developing.

02.00 P.M GMT

Gold Prices Rally, Netherlands "On Edge"
of Downgrade, Central Banks Add to Gold Reserves

Gold Prices rallied to $1643 per ounce by Tuesday lunchtime in London - 1.2% up on yesterday's low, but still shy of where they closed last week - ahead of tomorrow's Federal Reserve decision and with Eurozone concerns focusing on the Netherlands.

Based on the PM London Gold Fix, Gold Prices remain 3% below their 200-day moving average.

Silver Prices rallied back above $31 an ounce by Tuesday lunchtime - though they remained around 2% off where they began the week - while European stock markets edged higher following Monday's steep drop and commodities also made gains this morning.

The Euro meantime regained a bit of ground against the Dollar, though remained below last week's close, with the Federal Open Market Committee due to announce its latest monetary policy decisions tomorrow.

"If the Fed fails to hint at more quantitative easing, we may see a sharp drop in Gold Prices," says Hou Xinqiang, analyst at Jinrui Futures in Shenzhen, China.

"With the Dollar being slightly stronger, there is no reason at the moment to be interested in gold," adds David Wilson, metals research and strategy director at Citigroup.

Since this time last year, the Dollar Index, which measures the strength of the Dollar against a basket of other currencies, has risen nearly 9%.

Over the same period, sales of investment Gold Coins by the US Mint have fallen more sharply than those for silver, the latest US Mint data shows.

The Netherlands successfully sold €1 billion of 2-Year government debt - as well as a further €0.995 billion in 25-Year government bonds - at auctions on Tuesday, following the collapse of its government a day earlier.

Average yields were little changed on previous similar auctions. The spread between benchmark 10-Year yields on Dutch and German government bonds however hit a three-year high Monday, as 10-Year bund yields fell to a record lows below 1.64%.

The collapse of the Dutch minority government, after it failed to get backing for its austerity plans, "is clearly credit-negative for the Dutch sovereign," says Sarah Carlson, London-based senior analyst at ratings agency Moody's.

"It generates both political and policy uncertainty."

"The Dutch are on the edge of a negative rating action," said Chris Pryce, director, Western Europe at fellow ratings agency Fitch last week, speaking to the Telegraph.

The newspaper reports that the Netherlands has half a million homeowners - nearly 3% of its population - in negative equity. Dutch central bank governor Klaas Knot has warned that borrowing costs will rise if the country loses its AAA status, as its debt is not regarded by investors as a safe haven in the same way as that of Germany and the US.

Here in the UK, public sector net borrowing was £15.9 billion last month - up from £15.1 billion in March 2011 - according to data published Tuesday by the Office for National Statistics.

Excluding the effects of financial interventions - the government's preferred measure - net borrowing last month was £18.2 billion - compared to £18.0 billion a year earlier.

The March figures mean that borrowing as a percentage of GDP fell from 9.27% in the financial year 2010/11 to 8.30% in 2011/12. Preliminary first quarter GDP figures are due out Wednesday.

"They are making gradual progress in reducing the deficit," says Royal Bank of Scotland economist Ross Walker.

"[But] it's going to get more difficult in subsequent years...we haven't really had any significant current expenditure cuts."

Overall debt meantime rose from £905.3 billion (60.5% of GDP) to £1, 022.5 billion (66.0% of GDP) in the year to the end of March.

Gold Prices in India rose to their highest level in two months, India's Economic Times reports, hitting Rs 29,100 per 10 grams as many Indians celebrated the festival of Akshaya Tritiya, traditionally considered an auspicious day to Buy Gold.

Central banks worldwide added nearly 58 tonnes of Gold Bullion to their reserves last month, with Mexico and Russia each buying over 16 tonnes of gold.

08.00 A.M GMT
Long Term=Up (major resistance 1767-1804 needs to be exceeded on a monthly close)
Medium Term=NEUTRAL (Major Resistance 1767 Monthly Close) Very close to turning bearish.
Intermediate Term= Bearish (we remain in an choppy trading range in a downtrend channel)
Short Term= Bearish (Short term cycles due to bottom – but still bearish)
Support and Resistance for Tuesday
Initial Resistance for 1642-1652 and 2nd tier 1662-1666
Initial Support 1623-1631 and 1604-1612

Key Events coming:
Options expiration on 4/27 for Gold and Silver; (Gold expiration not a big contract month)
India festival April 24th- Akshaya Tritiya, the third day of the new moon of Vaishakh month (April-May), is considered one of the four most auspicious days of the Vedic Calendar. On this day the sun and the moon are simultaneously at their peak of brightness.
FOMC Meeting Two-day meeting, April 24-25. (GET READY FOR SPIN STATEMENTS

Recap

Gold pulled out of the wedge on Monday and it was to the downside. The European situation we’ve started highlighting again to watch out for two weeks ago is now arriving at the forefront of the news media. The situation is much further along in Europe than most think. It’s at the AUSTERITY POSITION. In other words, where the PAIN meets the pavement as citizens with “entitlements” are getting thrown out onto the pave from the Government Wheel barrel and when the Brinks truck comes by for the monthly payments it doesn’t stop anymore but rather runs over anyone in the middle of the road trying to flag them down.

Now is when the weakest governments fail and get ousted and the ‘crowd’ has taken to the streets. Thus there are two factors to consider. The first is that China is going to lose a lot of EXPORT business to Europe as the liquidity squeeze tightens its grip on money. While the ECB, IMF, FED, and every other three letter bailout king pumps trillions down the chute, the money goes in the bank and out what goes out the door quietly is beginning to leave for other safer places in which to store funds –and the logical is Switzerland and USA. (USA for liquidity in the vast treasury market – and safety is why they will take a zero interest return.)

The return of IMF chief Lagarde with only 430 billion in donations for the latest bailout and a reported BALK from North America (USA and CANADA) of no donations got things going but a new crisis now with the Dutch Government and yet another collapse of government and offered their resignation to the Queen. Add in the backlash against cuts in Europe and weak economic data had the markets down from the get go. Even the CZECH government is running into trouble also but that was just rumblings getting louder. But it’s the same situation underlying issues there.

Moody’s reports the Dutch are ready to lose their Triple AAA ratings and major elections in Germany, Ireland, Greece and France are adding fuel to the fire of uncertainty. The growing contraction and weaker data out of China are directly related of course to Europe and USA major contractions that are underway in the Western world are showing up in data as well.

Netherlands, Italy and Spain will be back in the market on Tuesday looking to SELL MORE BONDS for what else---more debt borrowing.

Going to the Gold

For gold, the tight range finally gave a break to the downside on Monday as all assets were spanked as the ‘dash for cash’ was ratcheted another notch. We continue to await chart signals that will favor the short term cycles are on its last day of the ‘window’ for a low to take place and potentially have the (late) seasonal take place. Until we see price react, the trend remains down.

The Bundesbank leadership told us today that a Euro breakout is silly to even think of and that can only mean one thing -----------ITS ON THE TABLE for discussion.

Short-Term

The chart below shows the action since the 1681 high as it continues in a choppy and overlapping condition with swift rallies only to sell off once the short term traders get on.

The circled area in white was the WEDGE we showed last night that we were expecting a move out of. We mentioned last night that if we broke this area it would activate lower channel lines in the 1620 area and today’s low at 1623 had the results play out as described. We’ve expanded the chart tonight so you can see the lower purple and white dotted channel support lines that are now activated as we’ve put white arrows on the lines to now watch on the chart.

If we break the LOWER PURPLE CHANNEL LINE and white dotted line and close below the Monday lows, it will activate the lower weekly price supports in the 1575-1590 area. (See next chart). For now the trend is down but today’s low is ONE of the two places most likely for a low to develop. (The other is 1575-1590).

Gold Tick chart with price channel lines

Short Term – Short Term Cycles

The Short term cycle window closes today and the next two week TREND either started today, or will begin on Tuesday.

On Monday, gold reached the 1625 area which is the first place where support lies for this week (see chart above). The other key area and more important is the bottom dotted blue trend line in the 1575-1590 area on the chart below.

Today was the last day the short term cycle window is open and the odds for a turn here are 75% on a weekly basis that today was the low. We also got a REVERSAL day where price closed on the highs of the day. However, this does not mean we can’t get a cycle inversion. For new readers, a cycle inversion is when the cycle fails and price stays in the same direction. The RED CYCLE in January was an inversion. Note how price rallied an additional two weeks to the next blue cycle before the rally ended.

We have also stated that in order for the bear market correction to end, the LOWS MUST ARRIVE on the blue cycle and not the red. It is this technical that has kept us from proclaiming the “low is in place” or the “correction is over.” We don’t know anyone else besides Larry Edelson who has had that stance from the get go Prechter doesn’t count as he has been bearish since gold was under 500. We only mention this because if we get a cycle inversion now and we move lower yet another two weeks and price reaches that lower trend line near 1575, then the potential for the low to be in will come in play.

We think the STOCK market is sending FED Ben a message for this week’s FOMC meeting and we know how that has been playing out.

What is DIFFERENT this time? Well, the last two FED announcements on GOLD was when gold was at its highs. Might he be set up to deliver the we will bail out everything speech and send gold higher? Even more intriguing is the fact that options expiration this week would favor price at 1675 in gold at 32.50 in silver as the OPTIMUM PRICE for the control boys and their options sales. In other words, that’s where they make the most money for the month. The last two FED speeches gave us 100 and 60 dollars lower in gold. Might it be a SPIN to move price higher this time? This would play with the seasonal and the short term trends in gold.

In summary – gold is most likely to turn here at 1625 or the lower trend line on the chart at the 1575 area. As soon as we see price react, we’ll change our stance.

The trend is still down, but today’s low has a “LITTLE” bit of bottoming action but the volume was low. We’ve either bottomed here and we’re going to move higher into May 4th or this panic in Europe is going to escalate into a full blown cycle inversion and provide another two weeks lower.

Now that the short term cycle window is closed, let’s see if price begins to react to the cycle that is supposed to turn up. We want to see a close above the upper dotted channel line, but even a close above 1655 would begin to favor a short term low is in place and the cycles are kicking in. BUT WE NEED TO SEE price react to this cycle before calling for the low to be in place.

What Next?

We enter Tuesday with a lot on the line in regards to short term cycles and price supports. We discussed major support at 1590-1600 and that new price is now 1575-1590 as key weekly support. We also mentioned a minor support at 1625 and the 1623 low actually used the minor support on Monday as the low. With the FED meeting on Tuesday and Wednesday there should be more CHOPPY trends and ranges will just add more concern and edge to an already dangerous situation. THE EUROPE DEBT WILL LEAD on Tuesday ---with NETHERLANDS, ITALY and SPAIN all going to the WELL for more debt---promises to be a WATCH point. If the auctions go good, we’ll get some relief but then it will be FED WATCH TIME until mid day Wednesday when the fed policy and speech will be coming due.

If we break down below 1620, then a move to 1575-1590 could come in play. There is initial support at 1620-1625 intra day also. On the upside, Tuesday’s resistance will be in the 1652-1655 area. The downtrend is still in play. Seasonal trends, short term cycles, and all technical indicators are extremely oversold and FAVOR HIGHER--- but until price shows any action of bottoming, the downtrend is still in charge and we need to continue to respect it.

Any close below that dotted red downtrend line would favor a hard drop to 1575 with the potential for more. Let’s see if we get any relief on Tuesday. If we don’t the potential for a CYCLE INVERSION will be activated and that will open up the lower dotted red trend lines on the chart. I think I heard we have had seven straight down days of closing price but even stranger is how gold has not broken down hard.

Gold Daily Price chart with Gann angle downtrend line

Bottom Line

The Indian festival is this week, but so is the FED FOMC MEETING ON TUESDAY and the SPEECH on WEDNESDAY. The options expiration also has a lot of concern but nothing trumps the Europe situation and its ability to continue the trillion every other week drain.

April 24

05.00 A.M GMT

Unabated concerns over Euro zone’s debt crisis and US economic releases postponed investor action. Investors have already digested the news of the stabilization of Chinese factories in April as output ticked higher. HSBC Flash Purchasing Managers Index showed China’s industrial activity recovered slightly to 49.1 in April from revious month’s 48.3. However investors will closely watch the US Federal Reserve’s policy meeting later in the week which may weigh in on US economic health. At the same time, as per reports, Indian gold traders are staying away from purchasing gold, despite the Akshya Tritya on Tuesday, as weak rupee made importing gold more expensive.

There is a clear division among the FOMC policy makers on when the Fed should start tightening monetary policy. Some policy makers have called for an exit and rate hikes as early as this year, while a couple of committee members felt that policy accommodation should continue until 2016. With some of the recent U.S. economic data beginning to show signs of weakness and forecasts predicting slower economic growth, it would not be surprising to see the Fed maintaining a dovish stance and expressing a cautious outlook on the economy and the labor market, but stopping short of announcing another round of quantitative easing at this meeting.

However, QE3 will not be completely out of the picture and will remain as a viable option, especially if the occasional soft spots in the U.S. economic data become a persistent trend of deteriorating economic conditions lasting for at least a couple of months. Although additional quantitative easing may not come until the second half of the year or simply not at all, the future fate of the U.S. dollar will continue to depend on QE3 expectations and the Fed’s next move.

The dollar rose amid increased political risk in Europe after the Socialist Party candidate for the French presidential election, Francois Hollande took a narrow lead in the first round of the country’s election. Far-right candidate Marine Le Pen finished a surprise third. French election results overnight confirmed that Nicolas Sarkozy and Francois Hollande will face one another in the final runoff election on May 6. Scotia’s European economics team notes that the market consequences of the results (albeit not unexpected) are likely to be not great. Mr Hollande has said that he wants to renegotiate the fiscal compact that was agreed by Mr Sarkozy. In particular, Hollande wants to create more pro-growth measures. For France specifically, the underlying thrust (i.e. pace of tightening) of the domestic fiscal policy plans under Hollande would not be that different to Sarkozy. However, the emphasis is likely to be more dependent on tax hikes than spending cuts.

Economic Events scheduled for April 24, 2012
that affect the European and American Markets
07:00      EUR        Finnish Unemployment Rate                         7.40%
The unemployment rate represents the number of unemployed persons expressed as a percentage of the labor force. The unemployment rate for a particular age/sex group is the number of unemployed in that group expressed as a percentage of the labor force for that group.
10:00       EUR Industrial New Orders (MoM)          -0.5%         -2.3%
Industrial New Orders measures the change in the total value of new purchase orders placed with manufacturers. It is a leading indicator of production. A higher than expected reading should be taken as positive/bullish for the EUR, while a lower than expected reading should be taken as negative/bearish for the EUR.
15:00      USD        CB Consumer Confidence         70.3 70.8
Conference Board (CB) Consumer Confidence measures the level of consumer confidence in economic activity. It is a leading indicator as it can predict consumer spending, which plays a major role in overall economic activity. Higher readings point to higher consumer optimism.
15:00      USD        New Home Sales        320K        313K
New Home Sales measures the annualized number of new single-family homes that were sold during the previous month. This report tends to have more impact when it’s released ahead of Existing Home Sales because the reports are tightly correlated

April 23
04.00 P.M GMT
“There’s pressures on the entire building right now.”
Look for 1633-1637 as resistance for the remainder of the session.

The combination of a weaker than expected Euro zone PMI readings and the prospect of leadership changes in France have hit commodity markets like gold and produced a much weaker footing. Adding into the negative economic track is political and financial problems for the Dutch. While the markets could have fashioned a positive manufacturing forecast for China overnight into a positive, that potential vibe wasn't embraced and global equity markets have come under rather definitive initial pressure.

The bears point out that the pattern of lower highs and lower lows on the charts has extended and that fears of slowing in the Euro zone, has left gold and commodity markets under near term pressure. The bulls has to hope that both the ECB and the US Fed will be quick to step in and revive the economic track with additional easing promises. In other words – the markets are PREPPING commander Bernanke for his speech this week and they are letting him know that these markets work on liquidity --- not fundamentals. If they worked on fundamentals, the Dow would be under 10K and gold at 3000. But that’s another story.

Therefore the FOMC meeting this week will probably be a moderately important event for the gold trade and all markets for that matter.

At least to start today, the gold market appears to be facing a risk off environment, where adverse dollar market action might give the bear camp added resolve.

Equity markets in Asia were weaker overnight, with the market unable to spin a positive Chinese manufacturing forecast . European markets were also weaker to start today off fresh CDS and debt concerns from the Netherlands. Early in the US trade today, share prices were sharply lower, with the markets apparently seeing a continuation of Euro zone debt problems directly ahead. Adding into the negative vibe toward the Euro zone, was a weaker than expected Euro zone April services PMI result. While the US economic report slate today is effectively empty, many markets have started the new trading week in trouble.

At GoldTrends, the one thing that has separated our analysis of the global liquidity crisis from all the others is that we have maintained that a liquidity ‘event’ is the one thing that can bring gold down and we have maintained that stance for well over two years. A dash for cash respects nothing as there is no choice. If your long gold and you have a margin call in copper you’re going to have to rid yourself of some gold. But on a much higher level, the big money goes into cash and treasuries and therefore the demand for DOLLARS becomes huge in these times.

The other issue we highlighted at the forefront over the past week was this Euro debt situation. Almost every week now there is the need for another Trillion to get us through a few more weeks. The fact that the IMF came to Washington last weekend and walked away with no commitment from North America (USA and CANADA) must have left some of the Euro banksters, and the ECB a little bit stunned and when Ms Lagarde came home with less than ½ a trillion in new bailout funds, the market started selling from the get go last night

Gold – Going to the Chart

Last night we discussed the low volume and tight trading range of last Friday and for the last 5 weeks and indicated that action of that manner ---the tight range and volume of Friday suggested a move was ready to develop for today.

The zoom in on the chart shows the pattern since the 1680 failure in gold. By using a TICK chart, we can see the real pattern as it is a volume based chart and therefore eliminates the slow off hour patterns in gold and sticks to volume. We believe this is the new way to go to see the real patterns in gold and silver.

This morning’s low has so far remained within the purple channel lines that we have been following for three weeks and therefore it is an important price point for today. The spike low to 1623 did break the downside but the candle closes so far has remained above the line. Resistance for today will be strong in the 1633 to 1639 area on the upside. Support is currently 1623-1627 but if there is an escalation in lower prices the 1570 – 1600 will be the next target. Let’s look at another chart.

The daily chart we’ve been using shows a well defined downtrend and that a short term cycle low point is due. The ‘window’ for a low ends today and this new low we are making today is still in line with this low we are expecting. These short term trends we watch have about a 75% accuracy level of picking the low points for the month. The other 25% of the time is when a cycle inversion happens and the market continues lower (or higher) into the next phase. The best example of an inversion is what happened in January. Notice how the RED trend change in January did not bring lower prices but instead the market continued higher into the next blue cycle before a turn developed.

Perhaps more important is the channel lines on this chart. Note how the lower channel line points to the 1590 area on the chart. Any continuation of the downtrend this week would favor this area next as the place to look for a short term low point.

At the moment, that is the preferred area for a strong support point should the trend not reverse today.

The 1660-1665 area remains our upside point where we feel the downtrend would be neutralized and has been our number to watch on the upside since this drop from 1680 developed. Last weeks high at 1659.60 in the June contract reinforced that price point.

In summary---all trends except the long term remain down. The FED FOMC meetings begin on Tuesday and by Wednesday it will be speech time again and the last two have not been good for gold. Options expiration is also on tap this week, but the open interest in metals is at the 1675 area in gold and 32.50 in silver and that would be the PRIME location for the markets to end where the control boyz would make the most money. The India Festivities this week usually bring on demand for gold and with the MARKETS prepping the FED for what they better say --- it does bring some potential that gold could still make its low with this current short term trend change that is due to turn up. Thus the potential lows for the week are 1590-1600 and here near the 1625 area. The 1590 is a stronger magnet, but let’s see what we do here at 1625.

Look for 1633-1637 as resistance for the remainder of the session.

With THE FED NOW CORNERED BY THE MARKETS --- WE DON’T SEE HOW THEY DON’T COME OUT IN FAVOR OF MORE LIQUIDITY at the WEDNESDAY SPEECH and that might be the thing that allows the short term trend to turn up from here. While we can’t hang out hat on that, it is possible that they will say what they have to in order to stop the tumble in the stock market.

10.00 A.M GMT
Support: 1638.00, 1624.00, 1608.00, 1598.00, 1590.00
Resistance: 1650.00, 1654.00, 1662.00, 1666.00, 1673.00
Our opinion is buying gold around 1631.00, targeting 1653.00, 1680.00 and stop loss 1624.00

07.00 A.M GMT

Short term cycles are DUE TO BOTTOM right in this area.

WATCH THE 1629-1637 area Monday.

Long Term=Up (major resistance 1767-1804 needs to be exceeded on a monthly close)
Medium Term=NEUTRAL (Major Resistance 1767 Monthly Close) Very close to turning bearish.
Intermediate Term=NEUTRAL/Bearish (we remain in an choppy trading range)
Short Term= Bearish (Mixed results and a choppy trade range of 1600-1680 continues)
Support and Resistance for Monday
Initial Resistance for 1655-1665 and 2nd tier 1681-1688
Initial Support 1627-1637 and 1590-1605

Key Events coming

Options expiration on 4/27 for Gold and Silver;(Gold expiration not a big contract month)

India festival April 24th- Akshaya Tritiya, the third day of the new moon of Vaishakh month (April-May), is considered one of the four most auspicious days of the Vedic Calendar. On this day the sun and the moon are simultaneously at their peak of brightness.

FOMC Meeting Two-day meeting, April 24-25.

Recap

Gold traded in a very tight range again last week---for the fifth week in a row.

The underlying concern all week has been the continuing and on-going European Debt crisis. Spain has been in the news all week and although the auctions were successful, much of Europe in near political crisis levels.

THE IMF is met in Washington and raised another 430 billion dollars to bail out whoever needs it in the next few weeks. There will be plenty of takers that’s for sure.

There is really nothing much to add. We’re in a tight trading range that should be making its move and begin the next two week trend. The upside has the advantage with short term cycles due to turn up and the seasonal remains favoring higher into mid May or early June. With that said, we await price to begin a reaction and end this chop we have in price.

Seasonal

this is the most likely the latest week for a spring seasonal move up to occur within its normal parameters. The potential to drop to 1590-1625 could still happen first. We need a close above 1666 and then 1681-1688 to get out of this horrible trade range.

Short-Term

Markets continue to act totally erratic and not able to hold any trend but we expect that to end this week and a new two week trend to be established.

The chart below shows the action since the 1681 high as it continues in a choppy and overlapping condition with swift rallies only to sell off once the short term traders get on. This is exactly what happened again on Thursday.

If we break the Thursday lows and the channel lines, it will activate the lower channel line in the 1620 area and as we mentioned above, price ranges of 1590-1600 would also come in play on a break of last week’s low.

The chart shows the WEDGE and how price is now coiled in between them and a break one way or another is about to develop.

Gold has now been stopped 5 times already at 1655-1660 so that is the area we need to watch for as upside resistance. As long as we are below that point, the downtrend from 1681 is still in play.

This zoom out view of the current downtrend channel shows that the upper line is still around 1670 and until we close above 1681 on a weekly basis, the downtrend will still be in play.

What Next?

We enter Friday at the same place we entered Thursday---with price sitting right at the 1640 area, and we cannot over look the potential for another break lower from this price zone. Trends remain down.

IT LOOKS LIKE THE 1630-1640 area is going to be an important price point for the Monday trade again as first support. If we break down below last week’s low, then a move to 1590-1600 could come in play. There is initial support also at 1625. On the upside, Monday’s resistance will be in the same area but just a bit lower at the 1652-1662 area. This thing can still go either way, but the upside should have the cycle and seasonal advantage. If the seasonal doesn’t get going this week, the commercial hedges will begin to cover some of their positions.

And close below that dotted red downtrend line would favor a hard drop to 1600 with the potential for more.

Short term cycles are due to turn higher this week, the April seasonal is overdue, the Indian festival is this week, and price is oversold and at key price levels---but the gold price trend is still down and has not turned. Until it does, its best to be patient.

This week has ANOTHER FOMC FED MEETING and options EXPIRATION on gold and silver is fast approaching. SILVER’s is a decent size but the gold one is a small one as MAY is not a contract month in gold.

Bottom Line

EVERYTHING IS IN PLACE NOW FOR A TREND MOVE that would last into the first week of May --- all we need now is for price to agree and SHOW that it is reacting and on which side. The upside is favored, but we need a close above 1681-1688. Until then, we can’t eliminate the downside.

Short term cycles are DUE TO BOTTOM right in this area.
WATCH THE 1629-1637 area Monday.

The one thing we’ve brought up over the past month as the one concern we’ve had is the Gold Stocks and their performance. The chart of the gold stocks below show price breaking below the long term moving averages. That is a very disconcerting technical breakdown. If we look at the chart it has only happened onceundefinedduring the crash of 2008 at a time of the last liquidity crisis. While the blue 34 month is well above RED 13 it nevertheless has put the long term out of bull mode and in neutral. Odds favor a test of the trend lines below price will take place in the 325 or 400 area, depending on which channel line will provide support. With gold’s 34 week moving average near turning its MEDIUM TERM trend from Neutral to Bearish, it sends a warning out to us that the liquidity crisis in Europe remains in trouble and that means that Gold and Gold stocks will remain under pressure as long as there is a hint of a default in the system.

April 23

05.00 A.M GMT
Gold Weekly Update

Long Term – Up -But failed at key resistance of 1767-1804 and correction in progress.
Medium Term –Neutral – close to going to bearish trend.
Intermediate term – Bearish -- would favor bullish on close above 1665
Short Term – Neutral – Short term cycles are due to bottom and rally this week. A close above 1651 and 1666 would be enough to flip to bullish.
Resistance for this week 1660-1665 /2nd tier 1677-1687 (if 1665 taken out – then 2nd tier)
Support for this week 1625-1639/2nd tier 1590-1600

RECAP

Gold was down 18 dollars for last week and is in line with a short term bottom that is due in gold. Three times gold tried to get above our 1660 area last week and three times it failed. However, the support at 1634-1644 listed also held with the exception of a few minutes when gold traded below 1634 on Thursday (1631). We've had five weeks of a very tight trading range and odds favor a move one way or another this week. The advantage is to the upside, but until we close above 1665 and 1681-1688, it can still go either way. You'll see later in the report how this range is the tightest we've seen in 3 years and suggests a move one way or another. Markets are very fractured right now---we see gold down 15 and silver unchanged, or the Dow down 100 and the Nasdaq unchanged. Thus there is much uncertainty. It's not usually a good sign but with the bullion range so tight, which ever way we break will favor the trend for the next two weeks.

Last week’s discussion that QE hasn’t stopped nor will it and the Europe crisis and Spain is making its way to the forefront once again. The IMF was in Washington over the weekend asking donations from countries in order to buy some more time. Leading world economies on Friday pledged $430 billion in new funding for the International Monetary Fund, more than doubling its lending power in a bid to protect the global economy from the euro-zone debt crisis.

The promised funds from the Group of 20 advanced and emerging economies aim to ensure the IMF can respond decisively should the debt problems that have engulfed three euro zone countries spread and threaten a fragile global recovery.

"This is extremely important, necessary, an expression of collective resolve," IMF Managing Director Christine Lagarde said. "Given the increase that has just taken place, we are north of a trillion dollars actually. So I was a bit mesmerized by the amount."

If the situation escalates, it will not be good (initially) for gold and silver as a liquidity squeeze is the one thing has the potential for gold and silver to correct (along with all the other markets).

Last Week articles of interest
Can we believe this first article ?

With all official trading and financial ties with Syria being severed there were stories this week that Damascus was looking to offload everything it could to raise cash, including currency reserves. Two gold traders in the United Arab Emirates said the Syrian government has been offering gold at a discount, with one saying it was making offers at about 15 percent below the market price. The World Gold Council estimates Syria had about 25.8 metric tons of gold as of February 2012, representing about 7.1 percent of its total reserves.

GOLDTRENDS says: NO – WE THINK IT IS BALONEY – and here’s why. A confidential mid east source has relayed to me that physical gold is very hard to acquire at the moment and that it has not been this hard since the 2008 lows in gold and during the last liquidity squeeze. IF anything, there is a push by the media to give gold a very bearish view and while we’re not saying gold can’t go lower, the above type of story does not seem credible.

Scotia Capital analysts noted that some gold miners are hedging again and that we are likely to see the first year of net hedging in over a decade. Scotiabank GBM estimates about 15 tons of net producers hedging in 2012 which is less than half a percent of new mine supply. Scotia does not believe that senior gold producers will change their hedging strategies, but the market is principally seeing hedging come from non-gold producers trying to secure financing for base metals projects and from smaller producers that require bank financing to build their projects.

Spanish 10-year bond yields rose above 6 percent this week as the market rotates through southern Europe, with the current focus on Spain.

The Current situation and coming week
FOMC FED MEETING APRIL 24th-25th

The last two meetings gave us a 100 and a 60 dollar gold drop. We have yet another one this coming week.

Jeff Miller from New Arc Investments on the Fed below from an Seeking Alpha article;
Get ready for a week of renewed focus on the Fed. No one expects a policy change, but there is plenty of room for disappointment. In the new era of Fed communications there will be plenty to analyze, including the following:
1.    The FOMC statement, which can be carefully parsed for small wording changes and evidence of disagreement or dissent;
2.    The updated economic outlook;
3.    Updated projections from each FOMC member, with a report showing ranges and central tendencies;
4.    A press conference where Bernanke will try to explain it all.

Back to GoldTrends

The bottom line for traders is that these meetings have been hazardous to the downside for gold. We can never tell when they will say something that would have an opposite effect but after the last two meetings, extreme caution is urged and if I happen to be long, I will consider exiting. While I survived the 100 dollar drop without a loss, the last meeting created a loss for my trading. The problem of course is what if they say something that propels gold 100 higher this time? It has become a big thorn in trading when the FOMC meets.

Other news to watch for

The Indian Government’s postal department announced it will be offering a 6 percent rebate on gold coins of various denominations for the forthcoming Akshaya Tritiya Festival starting April 24, which is one of the biggest gold buying festivals in the country. The rebate will likely attract significant buying interest, particularly since the recent three-week strike by jewelers in the country shut in a lot of retail demand.

NOTE: This could what the SEASONAL HIGHER TREND has been waiting for. We’ll elaborate later this week. But this is a key to watch for.

OPTIONS EXPIRATION is this week --- it’s a small one for gold (May has no futures contract) but the May silver one comes due.

Trends

the long term uptrend is still intact but until we see a monthly close above 1767 and 1804, we remain in long term wave sideways correction that began last August for Gold and last May for silver. The medium term remains neutral as price is below the 34 week moving average but the danger has increased significantly as the medium term moving averages are very close to turning bearish. A monthly close below the moving averages would flip the technical reading to bearish.

We enter this week with the BULL BLUE moving average only 17 cents above the Bear Red trend average. With the lower green channel line at the 1590-1625 area, it’s going to take support there and a close above 1700 very soon or the medium term trend of gold will turn bearish and that’s something we haven’t seen since the 2008 correction. In summary, it is yet another very important week in gold coming up for us. For longer term investors – we are at one of the two most likely places for a low this year. (1400 and 1600) are the likely choices for price lows.

Seasonal

The seasonal trends are late this year. With short term cycles due to turn higher and the Indian festival this week, if there’s going to be an upturn, this week is the favored week. First clue will be a daily close above 1655-1665 and then 1681-1688.

April 23

00.00 A.M GMT

Acceleration should occur above 1647 or under 1638 !!!
Supports / Resistances
Res 2   1,651.2900
Ex-High   1,647.2500
Res 1   1,646.8400
Pivot   1,642.8000
Sup 1   1,638.3400
Ex-Low   1,638.7600
Sup 2   1,634.3000

Economic Events scheduled for April 23, 2012 that
affect the European and American Markets

06:00:00 GBP Nationwide Housing Prices n.s.a (YoY) -0.90%

The Nationwide Housing Prices shows the value of the houses prices in UK and indicate current movements in the housing market that is considered as a sensitive factor to the UK’s economy. A high reading is seen as positive (or bullish) for the GBP, while a low reading is seen as negative (or bearish).

06:00:00 GBP Nationwide Housing Prices s.a (MoM) -1%

07:28:00 EUR Purchasing Manager Index Manufacturing 48.4

The Manufacturing Purchasing Managers Index (PMI) released by the Markit economics captures business conditions in the manufacturing sector. As the manufacturing sector dominates a large part of total GDP, the manufacturing PMI is an important indicator of business conditions and the overall economic condition in Germany. Normally, a result above 50 signals is bullish for the EUR, whereas a result below 50 is seen as bearish.

07:28:00 EUR Purchasing Manager Index Services 52.1

The Services PMI released by the Markit Economics interviews German executives on the status of sales, employment, and their outlook. Because the performance of the German service sector is extremely consistent over time, services does not impact final GDP figures as much as the more volatile figure on the manufacturing sector. Any reading above 50 signals expansion, while a reading under 50 shows contraction.

Weekly Gold Fundamental Analysis January 23-27, 2012

We continue to expect that gold prices will rise over the coming period, however, we also expect volatility to continue to dominate gold prices over the short term,

Gold prices gained back last week, as economic data from the United States generally showed better than expected performance and week after the upbeat flow of major fundamentals and bond auctions through the week, while U.S. dollar declined as the sentiment improved in the market and optimism spread wide after the downgrades last week failed to prevent European nations from accessing the capital market successfully.
Moreover, markets gained on the resumed Greek debt-talks as some progress was reached in finalizing a deal with the private sector on the percentage haircut and the coupon rate on the Greek bonds. However, the results are set to be provided by the end of this week. The importance of the talks is driven by the International Monetary Fund and European Union which demanded the nation to finish with the deal in order to become eligible to the offered second bailout package.

Traders will be eyeing the FOMC rate decision later on Wednesday, where the majority of analysts expect the FOMC to leave the current monetary policy unchanged. In addition, the GDP figures for the fourth quarter are expected at a strong 3.0% expansion compared with the prior 1.8%.

Nonetheless, traders will also continue to monitor the developments from the 17-bloc euro nation and the European leader’ latest moves to contain the debt crisis, where we expect volatility to persist through the sessions this week.

Moreover, several euro zone nations are preparing for bond auctions, where all eyes will be focused on the yields and demand on those bonds.

We continue to expect that gold prices will rise over the coming period, however, we also expect volatility to continue to dominate gold prices over the short term, as despite the recent improvement in overall conditions, yet risks are still threatening the progress of improvement, especially as the outlook for global economies remains full of uncertainty. We also expect Europe to continue to dominate the headlines next week.

YOU SHOULD NOT TAKE ANY MATERIAL posted on this BLOG AS RECOMMENDATIONS TO BUY OR SELL GOLD OR ANY OTHER INVESTMENT VEHICLE LISTED.

Do your own due diligence.

No one knows tomorrow's price or circumstance.

I intend to portray my thoughts and ideas on the subject which may s be used as a tool for the reader.

I do not accept responsibility for being incorrect in my speculations on market trend.

King Regards.

Tronlink Wallet Airdrop

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Friday, April 20, 2012

GOLD TREND April 23 - 27, 2012

Weekly Gold Fundamental Analysis January 23-27, 2012

We continue to expect that gold prices will rise over the coming period, however, we also expect volatility to continue to dominate gold prices over the short term,