Gold Trend 09/April/2013

Long Term=Bullish - major yearly resistance 1792-1804 needs to be exceeded on a monthly bass and close above 1840 to resume long term up bull trend.
Medium Term=Neutral/Bearish - It takes a weekly close above 1694 to turn the trend back to bullish. Resistance 1755-1765(Oct/Nov 2012 Resistance) Support 1450-1530
Intermediate Term=Bearish--it takes a close above 1625-1630 for bullish.
Short Term=Neutral --- Need a close above 1592 for Bullish

Support and Resistance

(NOTE JUNE GOLD NUMBERS– Spot and June gold about the same price

Initial Resistance 1582-1592-and 2nd tier 1602-1612

Initial Support 1561-1571 and 2nd tier 1547-1555

Gold Hourly Chart

The move since the lows doesn't have choppy or overlapping pattern look so far. The pullbacks are controlled and thus we have the potential of perhaps getting this short term cycle in gear for a decent bounce. We have the inklings of the start of an up channel and the pullback just missed touching in on Monday. It’s still early in the uptrend development but looks decent so far. Channel line supports are 1550-1555 and we were looking for a pullback to 1562 on our signal trade page today but the low only got as deep as 1566.

Resistance is the green 200 hour moving average at 1581-1584 & minor resistance at 1592 and the next resistance line 1600-1602 and that key blue line just sticking out at 1612.

The low this today at 1566 and subsequent turn back up so far looks constructive. The cycle window is open and the 9th and 10th are the ideal days for the turn. If we get a dip down into the 1550-1560 area on Tuesday/Wednesday it will favor a low and turn up. Moves above the green moving average is the next hurdle for the bulls and for the mini blue moving average to move above the 200 hour green. That would put the bulls in charge and favor the short term trends are up with a test of 1602-1612 coming up.

The bears need to break prices below that temporary channel we’ve drawn. Until then the bulls have temporary control.

What Next?

Monday’s pullback looked controlled and so far the low from Thursday is not choppy and overlapping. Short term cycles are due to bottom this week and April 8th and 9th is a daily buttonwood potential turn point as well as our own short term cycle. Other analysts are also looking for a turn in this time frame. Seasonal trends are also due to bottom. The 30 year average for gold in April is usually one that gives some choppy back and forth patterns as the downtrends convert to the Q2 upswing that usually develops. With a six month correction having transpired, low sentiment readings and a lot more analysts jumping on the bear bandwagon it puts forth the elements of a bounce attempt by gold to try and recapture the 1600 area and a short term cycle that favors higher.

It’s possible we could remain in a sideways trading range into the Wednesday time period where on more dip attempt would be attempted by the bears. KEY SUPPORT is the 1550-1555 area on a daily basis and the pivot for gold is the 1565-1570 area. As long as price is above 1570 the bulls have the advantage. If gold holds the 1562-1568 area then a push to 1600-1612 looks to be developing.

Bottom Line

this is gold’s best opportunity year to date to form a low and go after resistance points and to try and establish an uptrend. All the elements are in place sentiment, chart support, seasonal, short and medium term cycles, and anxiety at a global level.

It’s been long time that shades of War are bullish for gold but we maintain that NEWS during bear markets bring lower prices but the same news once a bull trend begins brings the opposite effect.

The one concern we do have is that money flowing out of Europe due to the banking fiasco still favors coming to the US. The one thing however that is developing on a short term basis is the dollar sentiment has become very bullish due to these matters and as you can see by the chart below, perhaps suggests that the dollar could be in the process of taking a breather.

The Chart speaks for itself as these kinds of sentiment levels have often brought peak prices to the US dollar. The Euro also has dropped almost 10 cents in a short time and could be in the process of a rebound. Last week’s price bar on the weekly dollar chart also gave a bearish signal. IF THE DOLLAR closes above 84.20 however on a weekly basis the trend will still be favored higher. So for the moment, the dollar has a chance to initiate a pullback but the situation in Europe is fluid and it wouldn't take much for the Euro to resume its slide.

 

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