Gold Trend July 17/2013

Long Term ~ Neutral – Need a monthly close above 1800 to confirm the bull market final phase underway
Medium Term ~ Bearish - Need a close above 1525-1580 to neutralize.
Intermediate Term ~ Neutral – GLD and HUI have neutralized the downtrend before gold. Odds favor we’re heading towards 1330-1360 on a move above 1305.
Short Term ~ Neutral/Bullish – The short term trend has gone neutral with potential for a rise above 1300-1310 -- which would be bullish to 1340-1360. The only question is the next short term cycle due the 22nd as to a high or low.
Support and Resistance
Initial Resistance 1291-1305 and 2nd tier 1315-1325
Initial Support 1255-1265 and 2nd tier 1232-1242

KEY RESISTANCE and Pivot POINTs for the WEEK 

R1 and R2 are 1 and 2 standard deviations of resistance to the pivot point and S1 and S2 are supports of 1 and 2 standard deviation.

This week's number to watch 1299-1315 and 1347-1360

Tuesday had Daily R1 at 1294 and high was 1295 – and S1 at 1272 and low was 1275.

Wednesday’s numbers are below.

Gold Hourly Chart

Gold continues in a range where 1st resistance has yet to be broken to the upside but the upside is still in play in the very short term trend. Since we have not exceeded the July 11th high at the last short term cycle, it is still possible to drift lower into the 22nd (plus or minus 72 hours). Once again, the mix and unknown is how Bernanke will testify in the next two days and what the control boys have in mind. Add to this the fact that the G20 is meeting on Thursday and odds favors the control boyz are making plans for the next 60 days.

The key now is whether we break above the 3 resistance lines just now above 1300-1305 as the lines drift lower as the week wears on. The upper dotted trend line now extends to the 1315-1320 area so if we do exceed 1305 odds favor that 1320 would be the first stop. Since it would exceed the July 11th high, it would put the short term cycle into inversion and the move to 1320 would most likely be quick.

Pullbacks to the 1255-1262 area is important to hold as the green 200 hour moving average and the yellow line support resides there. The lower dotted line is now at the 1240 area.

Stochastic’s are falling fast and will be bottoming soon. Thus we have to watch for a potential bust through the resistance zone.

The short term trend is still up but MUST GET ABOVE 1304-1310 or a move down to complete the short term cycle will still be in play. Watch the yellow line for support and then the green 200 hour moving average if we turn down.

Watch the resistance area on the chart. With the Bernanke speech beginning Wednesday, gold can move in either direction. With two days of testimony it could produce wild swings in most markets or the opposite where things remain quiet. With the G20 meeting also on Thursday and Friday, we still can go either way. History is usually on the downside and even though Qe3 does nothing for the economy, the market rallies on such news over the short term.

What Next?

The trade will be watching and the fact that Bernanke is testifying again this week has held gold at resistance. It’s certainly looking like gold is going to break higher.

If we get above 1304-1310 the upside should be in play BUT WE HAVE TO WATCH OUT FOR A FAKE OUT AS JULY USUALLY DOES A FEW BEFORE THE REAL MOVE TAKES PLACE. If we hit that area any pullback has to hold the 1280-1290 area.

As long as we're above 1255-1262 the trend is up but it’s still questionable as we need to exceed that 1304 area in order to keep the upside in motion. Watch the yellow trend line on the hourly as support. Getting above those lines above 1304 is the key to higher and for the CLOSE TO BE ABOVE 1304. OTHERWISE, we can still pullback into the 22nd of the month (plus or minus 72 hours) where the short term cycle comes due. That would still be the best setup for gold as far as cycles go.

In summary, a metal rally is underway. We can get a pullback but odds favor prices are going to move higher into September.

Its going to take an "event" of deflationary magnitude to put further price pressure on gold.  For now, its best to favor higher into September.

We don't see how Bernanke can change his mind again, but we can't totally dismiss it.  Regardless, the control boyz can still influence on the very short term, but intermediate term, higher prices are favored.

Bottom Line

Odds favor a medium term move higher is underway. Historically, the Fed meetings and the G20 meetings are usually not bullish for gold. The fact that we've been holding resistance and every downtrend attempt keeps getting bought certainly favors the upside.

Do not underestimate how big GOFO and the fact that the US bankers have covered their short positions. It’s about the strongest news we've seen since the bear market began for a potential bottom. It doesn't mean it has to start right away but a medium term trend up should develop on those indications.

With the Grand Trine cycle of July 17th -23rd and the Martin Armstrong Economic cycle on August 7th, odds favor a MAJOR CHANGE IS ABOUT TO TAKE PLACE IN THE GLOBAL DEBT SUPER CYCLE OUTCOME. A new interest rate cycle is most likely going to be part of that package. The last Grand Trine was in 1929 and 1966 and the Armstrong cycles have produced the most significant turns of our lifetime.

Going forward from here is going to get very interesting. GOLD DOES LOOK BULLISH HERE and barring a pullback from Bernanke or the short term cycle, we’re favoring a higher price at this point as we head into September.

 

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