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Long Term-Neutral – Need a monthly close above 1490-1526 in May to regain Bullish status.
Medium Term=Bearish Need a close above 1650-1675 to neutralize.
Intermediate Term=Neutral –need a close below 1403 to return to downtrend.
Short Term=NEUTRAL– resistance 1487-1494-- -- weekly support 1415-1425. Price in a 70 dollar trading range for 3 weeks. A close below 1403 goes bearish and a close above 1490 goes bullish.
Support and Resistance
(NOTE JUNE GOLD NUMBERS)
Initial Resistance 1450-1461 and 2nd tier 1471-1481
Initial Support 1415-1425 and 2nd tier 1398-1407
Gold Hourly Chart
Gold pulled right down to the support line we discussed on Thursday night in case of a sell off and is retesting the area in the Asia market. We'll have to see if London wants to test it as well. A failure of this area below 1415 would open the doors to the 1380-1400 area. Any new lows after Tuesday would bring the cycle scenario #2 above in play. Thus as we enter this week, gold is in a trading range of 1415-1485. That's a 70 dollar range and right now its a 50/50 proposition as to who is controlling the short term market. The daily pivot on Monday is 1446 and the weekly at 1447 so anything above 1450-1455 will have traders favoring the upside. Monday favors the 1420-1450 area as a trade range. Gold has been so difficult at every turn and that's how it is in a downtrend. Now we have a trading range to deal with that is close to three weeks old. If there is a physical shortage, the control boys are going to do everything they can to try and bring gold lower. Its their only chance because once an uptrend regains control its going to get harder and harder to control. People don't realize how big this really is. We're talking about the only sovereign monetary asset that exists and really with what is going on in the world right now, we're talking the most important national security issue in the USA. If the dollar were ever to fail as the reserve currency it would be catastrophic to the USA. Support is 1415-1425 and resistance is the 1445-1455 area on Monday. It won't surprise me to see both sides tested. ODDS favor that the 1415-1425 area holds Monday. The question is whether gold can get above 1450-1460. Look for a range day in that area. Depending on the outcome we'll have to see for Tuesday, but usually that's been the rally day of late.
What Next?
Here’s what it comes down to. The May 10th cycle date made the lowest price for May right on the date and the standard deviation window closes after Monday's trade. The window has been open since Tuesday and we can't rule out that this was the new cycle beginning a down move. But the reversal back up for the close gave more indication that Friday may have been it. With the window closing after Monday's trade, as long as we can close above that black dotted lower line on the daily cycles chart it will favor that the short term cycle is underway and favors higher.
Monday favors a range day in the 1420-1450 zone. Overall on the hourly chart we're in a 1415-1480 trading range. A break above 1490 would add to the upside confirmation of higher into May 24th. Any new lows after Tuesday would not be good for the short term and would open another two weeks to this pullback. Monday's ok for a new low as its still within the standard deviation but it needs to end the downside on Monday to still be within the standard deviation of this current cycle change.
Bottom Line
Evidence is high that there's a lot of ....lets call it INTERVENTION in gold. The economy has confirmed our suspicions from February that things are getting dangerous in the banking sector with a world wide interest rate cut in the past few weeks and bankers worry about deflation confirms our outlook from February as well. Gold, silver and the gold stocks are still in their medium term downtrends, but important support levels have been established in gold and after a nice rally, we really have only pulled back about 70 dollars. There's medium term support lines on the weekly charts in the 1350-1400 area and at the moment we suspect that those levels will hold on this pullback test. On the hourly charts, the 1415-1425 area offers the 1st support of the week and then the 1380-1400 area the 2nd. One of those two area's should provide a low for this week. On the upside, we've got to get out of this trading range and get above 1490 for more upside action to 1520-1540 to unfold and for higher prices into the 24th of the month. Lets see if 1415-1425 can hold on Monday. The first important close we need is 1455-1460 to get back on track. If Monday could close even above 1450 it would be a good sign a short term low could be in place.
YOU SHOULD NOT TAKE ANY MATERIAL posted on this BLOG AS RECOMMENDATIONS
TO BUY OR SELL GOLD OR ANY OTHER INVESTMENT VEHICLE LISTED.
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.
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
