Gold Price - Where is it heading?

[Miner]

Dear Explode
Nice graph and the metaphor.
What is the true value of gold and by what time frame ?
Also do you or any one can suggest if gold can be bought similar to an option of shares ? That is paying only part of it with no obligation to buy if the price falls ?

Regards

Miner

 

[Kauri]

IG Markets... either they know something we don't...or???
Cheers
.........Kauri

 

[Whiskers]

That bounce is looking a bit... dead cat.

 

[Kauri]

That bounce is looking a bit... dead cat.

My cat is still curled up asleep..
Now if only there was a way to arb it...
Cheers
........Kauri

 

[explod]

Dear Explode
Nice graph and the metaphor.
What is the true value of gold and by what time frame ?
Also do you or any one can suggest if gold can be bought similar to an option of shares ? That is paying only part of it with no obligation to buy if the price falls ?

Regards

Miner

I have no crystal ball. On an inflation adjusted basis gold's (1980 @US$800) value is said by a majority of gold analysts to be about US$2,300 per ounce.

The key to gold has always been its connection to money (the currencies) The US dollar is on a servere downtreand and because thier currency is no longer backed by gold ,rather, massive and increasing debt, some commentators are saying that gold will far exceed the above figure when more people come to realise the financial dilemma facing the US.

A lot of people are moving money into bonds at the moment which they believe to be safe. In 1931-32 bonds (even AAA) became wallpaper as institutions and companies, both private and government, defaulted.

The only certain protection back then and now is the holding of physical gold or the carefull selection of gold stocks.

As far as the cat bounce and the currrent gold price is concerned, the higher volatility merely indicates to me greater buying and selling pressures---equals increased interest---equals very good consolidation.

On my last 31 year cycle chart we could expect a very large uptick in gold from about the 5th to the 12th of /december till about the 15th of Jan08.

Another strong up peak area is early Feb.

As also mentioned by Uncle Festivus I am not a gold bug either. However I study this area at the moment for the financial well being of my family. In the pipeline for the future I watch energy, particularly uranium.

 

[Kauri]

Now the difficult part... working out where to place the stop to allow for a possible W4 without giving too much back... unless of course if the whole count is out of whack and then it doesn't matter..
Cheers
..........Kauri

 

[explod]

Now the difficult part... working out where to place the stop to allow for a possible W4 without giving too much back... unless of course if the whole count is out of whack and then it doesn't matter..
Cheers
..........Kauri

Looking back Kauri, on your chart beginning this month we see considerable support around the US$800, if this holds we should be able to regard it as a major support area going forward. IMHO

In many of the recent weeks following strong previous weeks we have seen weakness in the following Monday and Tuesday's. The rise last week was whilst US markets were preoccupied with their holiday last Thursday. They like to put their authoritative stamp back on when they return. Will be intresting to see how much longer they can do that. Prabably awhile yet as the gold market is still a fairly minor one in the bigger financial pot.

 

[>Apocalypto<]

Short on spot Gold,

Entry 801.85

Kauri u catch that fall on the euro vs usd? was a nice trip.

 

[Kauri]

Short on spot Gold,

Entry 801.85

Kauri u catch that fall on the euro vs usd? was a nice trip.

Yep, just posted the rumours about it on ...oh dear.. the USDJPY thread..
Cheers
.........Kauri

 

[>Apocalypto<]

Short on spot Gold,

Entry 801.85

Kauri u catch that fall on the euro vs usd? was a nice trip.

Closed my short at 792.20 :car:

 

[Kauri]

powered through the 1.6 line... just might be turning now around the 2.62 mark... have set my stop above the 50% ret of what I see as W3...
Cheers
.........Kauri

 

[Kauri]

powered through the 1.6 line... just might be turning now around the 2.62 mark... have set my stop above the 50% ret of what I see as W3...
Cheers
.........Kauri

She has made it to the min W4 area... now to see if it pulls up there..
Cheers
...........Kauri

 

[refined silver]

Trade it.

Why didn't you go long at $792 instead of just closing a short? Au is now up $14 from the low in about 5 hours.

If you keep trying to short a bull you'll get your head handed to you. Why not buy the dips and sell on strength, instead of trying to pick tops and sell before it reverses? In a bull market the surprises and biggest moves are always to the upside. Much more chance of profits, and larger ones.

 

[>Apocalypto<]

Trade it.

Why didn't you go long at $792 instead of just closing a short? Au is now up $14 from the low in about 5 hours.

If you keep trying to short a bull you'll get your head handed to you. Why not buy the dips and sell on strength, instead of trying to pick tops and sell before it reverses? In a bull market the surprises and biggest moves are always to the upside. Much more chance of profits, and larger ones.

LOL thanks for the trading advice, I'll keep it in mind.

I took a very nice chunk out last night in just over 1 hour.... so no complaints here....

if my little system tells me to go long i will take it. last night it told me to go short simple as that.

 

[Kauri]

LOL thanks for the trading advice, I'll keep it in mind.

I took a very nice chunk out last night in just over 1 hour.... so no complaints here....

if my little system tells me to go long i will take it. last night it told me to go short simple as that.

Trade It...
Sometimes you can't do right for doing wrong..
Have drawn in a tentative W4 type triangle (on the hourlies)... unfortunately have to go to see the eye doctor this morning so may miss a pyramid.. IF it plays out...
Cheers
.........Kauri

 

[chops_a_must]

LOL thanks for the trading advice, I'll keep it in mind.

I took a very nice chunk out last night in just over 1 hour.... so no complaints here....

if my little system tells me to go long i will take it. last night it told me to go short simple as that.

In your defence, it's the counter trends that give you the results quicker. So if you take into account time cost, they can be better trades... Plus you get quicker confirmation/ invalidation.

 

[refined silver]

Trade It

My apologies. I hadn't seen your entry point an hour before. If you are trading the 60second bar chart my advice was pretty irrelevant. No such things as bull markets and bear markets there.

 

[explod]

BOTTOM LINE
28/11:
EW Trend: Up (?)
Price Trend: Up
Trend Strength: Strong
Broker Consensus: n/a

TECHNICAL DISCUSSION
28/11:
VIDEO ANALYSIS (2 mins 49 secs)
LAYMANS: It was discussed in the last review (19/11/07) that Gold usually rallied into the end of the month of November before declining again in early December. This last surge higher probably got the bulls interested again but I feel they're about to be cleaned out over the coming weeks. I would not be surprised to see Gold reverse back toward $750, perhaps lower. The recent advance from September has been nothing of extraordinary, in fact such a parabolic advance has only occurred three times since 1980 and of the first two there was a dramatic selloff; one of 44%, the other of 23%. If we're to see a reversion to the mean in this instance we may see Gold back at $700.
TECHNICAL: How do we measure a parabolic rise compared to a healthy rise? What I did was take the 200 day moving average and plot it against price itself. I then went back to 1980 (the start of my data) to determine what was extreme, i.e. greater than 3-standard deviations from the mean, and what was normal. Normal was a reading of 50 or below. Extreme was a reading of 100 or higher. In 1983 Gold hit an extreme reading of 113. The following few months saw prices drop over $200. In 2006 the reading hit 144 followed by a price collapse of $165. The recent peak was 136. The fall to follow? We'll be seeing soon enough I guess. From an Elliott Wave perspective the corrective movement is also yet to run its course. Yes we had a 3-wave counter trend rally but time wise it was simply not long enough and price wise, not deep enough, to be considered complete. As such the best interpretation is that we've completed a wave-B high and we'll now see a 5-wave impulse down to complete wave-C - maybe as far as $720 being the major support where prices broke out from back in September.

TRADING STRATEGY
28/11:
I'm not suggesting the long bull run in Gold is done. Far from it with the Federal Reserve continuing to cut interest rates. What I am suggesting is that we're more than likely going to see a very healthy corrective movement before prices continue higher again. The obvious ploy here is put options or at least tightening stops on long Gold positions.


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Cannot agree with your certainty Nick and it will be interesting to see what pans out. The very ominous reaction to a further possible Fed rate cut by the stupendouse reactions by the Wall Street Indexes is but a part.

The past recent rate cuts have been followed wothin a few days by further weakness in the US$ index. The last 12 months - see following post.

Gold responded in the opposing on the last Fed cut to US$835.00 Since then we have had considerable volotility but, I would argue within that, good consolidation with the down ticks correcting very quickly.

I enclose the 12 month and 5 year gold charts as the picture paints the story best. This bull market trend is in early stages and betting on large corrections at this juncture could be an error.

 

[explod]

Unfortunately the chart intended would not transfer over .

From a January high of .85 there has been a consistent down trend to the current level of .755

Of interest is the fact that it is at the top of the down channel at a time when the issue of a further rate cut is being factored in.

Just my humble opinion and have been wrong before.

 

[chops_a_must]

Cannot agree with your certainty Nick and it will be interesting to see what pans out. The very ominous reaction to a further possible Fed rate cut by the stupendouse reactions by the Wall Street Indexes is but a part.

Failing to take out that high on this run is short term bearish. I closed my gold trade out yesterday (I hate gap downs off highs), but it is quite a way from the short term trend lines, and I will be back in there...