Gold Price - Where is it heading?

[wavepicker]

However my great concern is to detect changes and it will be my own view (tech) of charts that will tell me first when it is time to perhaps exit my current long positions.

Where is the problem?

Absolutely James. The charts on occasion if correctly intepreted can warn you of when a trend is at RISK of ENDING.

This is probably the one major difference between Fundemental and Technical Analsyis. The Fundementals attempts to give you an idea of the value a security based on supply/demand criteria, possible expected economic contraction/expansion, and other underlying factors to predict future prices. The only problem is, that in order to quantify these, certain types of data i.e balance sheets, economic figures etc need to be released and made public. No matter how much Fundemental research you do, there are certain pieces of information you will never know until they are made public in which case it might be too late.

As such FA can lag(and often does) the moves in the market as insiders would have started to react much earlier to the rest of the crowd.

This is where T/A can bridge the gap on occasion. Certain types of price patterns, market volume spread analysis, Cyclic Analysis, Elliott Wave patterns can show up clues to show that insiders are slowly liquidating positions and the Fundemental Framework may not be what it seems at a particular instant.

This is where I am others are coming from. Elliott Wave Analysis and even other types of T/A such as that of the Bill Maclaren methodology can show certian types of patterns such as Ending Diagonals, overlapping of Price swings, certain types of wave structures to warn properly trained chart readers that the trend maybe at risk of ending soon and possible high probablity trades(before even critical support/resistance levels have been broken) might be taken.

That is why I posted the charts on Gold and AUDUSD. Not to say that the trend HAS ended but rather that it showing the first signs that it could be at risk soon and that upside movement is limited. Having said that, especially in the case of commodites such as Gold, 5th waves do have a habit of extending

Cheers

 

[Kauri]

Fundemental.... T/A... as I have read a few times now... look back through the posts and read the thread... see where the weight of results is leaning... or nott...

Smiling
.........Kauri

 

[barrett]

Fundemental.... T/A... as I have read a few times now... look back through the posts and read the thread... see where the weight of results is leaning... or nott...

Smiling
.........Kauri

Without wanting to enter a debate about FA vs TA, I do have a related question for everyone: I know of various funds, both present and past, that exclusively use FA and consistently beat the indices over 1 to 10 year timeframes. Does anyone know of a market-beating fund that exclusively uses TA? Cheers

 

[barrett]

That is why I posted the charts on Gold and AUDUSD. Not to say that the trend HAS ended but rather that it showing the first signs that it could be at risk soon and that upside movement is limited. Having said that, especially in the case of commodites such as Gold, 5th waves do have a habit of extending

Cheers

Wavepicker, I meant to ask you about this, on the long term chart that you posted.. a lot of work by the way, so thanks for posting.. if we were to correct to say, the low 800s, could there still be a 5th wave extension? Another thing, in the final 9-month wave 5 on your long-term chart, it looks to me like wave 1 is the longest at the moment, is this right?

If we were to get down to around the low 800s, my guess is that the cash costs in the higher-cost producers would start to put in something of a 'price floor' for gold in that general area, below which the market would be aware of a real risk of denting supply.

After all many producers... particularly those with Australian mines.. are running on razor thin margins or worse still operating in the red, even at these prices. What a place to invest Not a bad place to live though.. I know a bar chick who's picking up $80K a year to sort core samples!

 

[barrett]

re disclosing trades.. I am always (since 2004) heavily long gold, silver and oil, stocks and bullion (>100% of net worth excluding super), and any charts I post are only aimed at identifying opportunities to top up. My money's never on a correction.. it's often waiting for one!

Lastly a couple of charts I meant to put up, firstly a daily of the gold price (log scale) showing the breakdown and retracement, that is likely to give heart to those selling or shorting in the short term.

Secondly, something Marc Faber has commented on, that gold has had a tendency to find support at its 300 day simple moving average during this bull market. Chart below - I only have it back to 2003. 300DMA is currently in the high 700s - a long way off.. but the tendency is interesting..

 

[wavepicker]

Without wanting to enter a debate about FA vs TA, I do have a related question for everyone: I know of various funds, both present and past, that exclusively use FA and consistently beat the indices over 1 to 10 year timeframes. Does anyone know of a market-beating fund that exclusively uses TA? Cheers

That is quite true barret, especially over the last 5 years. Quite a few funds have done so recently. But during bear and choppy periods that is very much not the case.

I actually posed this to a the manager of a Super Fund years ago and his response was that on the large his fund would stay invested during both bull and bear periods. i.e long term hold. He claimed his organization made no use of T/A because they had very little success timing the market, but more importantly because it was also difficult to shift funds easily (due to thier size) over a short term basis.

Now that does not mean all funds disregard T/A. T/A organizations like EWI, mainly advise Institutional Investors, so they are out there.

Re the EW chart, the chances are low if we reach the 800's that W5 will still be an extension IMO. It could morph into something else like a an Ending Diagonal. As mentioned earlier though these are long term monthly charts and Gold does have a tendancy to extend th 5th wave, but one thing that it high probablilty, and that this IS a 5th wave.Green wave 1 is the longest as I interpet it at present, and my intepretation could be wrong. In an impulse one of wave 1,3,5 will be extended. Wave 3 cannot be the shortest, but that does not necessarily mean it has to be the longest. When waves 1 and 3 are approximately an equal size, then wave 5 has a good chance of extending.

Cheers

 

[explod]

From a very simple point of view the gold price trying to hit US$900 found resistance around the start of the year, since the break in January it has become the support area, give or take $20 each way. Of recent times it bounced off it a week ago, again on Fridays close and again overnight.

IMHO it will hold and rise from these levels. However I take note of the reasoned arguments for a correction and with this gold bull rules are continually broken.

 

[treefrog]

yellow run 400 up, 200 down,
blue run 300 (roughly) up, so 150 down - ie to 910??

note this is Gold in $A which facotrs in fluctuations in the $A (obviously)

note also if the current weekly down candle ends this week as a down candle we have a weekly downtrend with plenty of momentum space left to run lower

 

[cuttlefish]

Well I'm primarily a fundamentals driven investor but if we're going to have a bit of chest beating going on then I'm going to refer back to the chart I posted in this thread on March 20th 9:32 p.m. and show a comparison to todays chart below. (chart on left is the one from march 20th reproduced - the price has subsequently fallen into and bounced off the bottom of the identified channel as can be seen on todays chart on the right).

In relation to how far I think this pull back could go I also posted a 5 year chart on 20th march. Am I going to move the funds I've got in gold producers and near producers into cash because of this short/medium term correction? - no - because I see no change in the fundamental drivers behind the USD and the gold price. Though I am considering moving a bit more into some undervalued oil producers as a secondary inflation hedge.

 

[Temjin]

Without wanting to enter a debate about FA vs TA, I do have a related question for everyone: I know of various funds, both present and past, that exclusively use FA and consistently beat the indices over 1 to 10 year timeframes. Does anyone know of a market-beating fund that exclusively uses TA? Cheers

There are literally tons of those. Look for professional managed "futures" funds. You have to be an accredited investors to look at some of the data, but just fake it.

Just type "Managed futures" on google and you will eventually find out.

As for gold, I guess my guts feeling was wrong. I'm still fundamentally long anyway, but bearish on the short term. Waiting for the gold price to reach the 200 MA levels. As well as silver. It's not guaranteed that it will move back there, but has to be prepared for it.

 

[josjes]

We have lots of Dow:Gold chart on the internet to show the ratio of shares vs gold in US.

Does anyone have a chart of All Ords : Gold over the long term, 10 year, 20 years time that they can post here. I have one from Stockcharts but it;s only over 3 years. Thank you.

 

[ithatheekret]

I entered the POG run on the electric side again , just now actually $898.43 with commission , fingers crossed hey .

 

[wayneL]

I entered the POG run on the electric side again , just now actually $898.43 with commission , fingers crossed hey .

Which contract is that on? 'Cause the M contract hasn't traded that low today.

Next question => long or short?

 

[ithatheekret]

It's on spot Wayne . I have an $898.05 now too . Would come under M1 though I think ........ thunk ......... but Euro Orient is an MM if I remember rightly .

Just had a crossing from underneath on the Ichi as well , should see a repeat in the price as it very light at present .

 

[Kauri]

16 april ..I don't have a short term view of Golds direction currently,(well not one that I would post ), but the down-legs look impulsive whereas the up-legs, in particular the present one, look corrective??

Cheers
..........Kauri

18 April.. Still looks that way to me...
Cheers
............Kauri

18 April.. Gold, in my opinion, is simply reflecting market sentiment...
Yesterday it was served up a Googly by Google.. expected 4c below.. came out with a +34c.. after market.. a little bit of confidence there..
Then Citi bowls up with a beamer... butt... the punter reckons that now that the big boys all have new captains they have taken the opportunity to clean out all the rubbish whilst they can still pin it on the old guard.. hence the impression that the worst is behind them and the team is now in rebuilding mode...
Add to that the various Fed boys spruicking today and the message they are lobbing out there..
Coupling, decoupling, derailing, PPT, leasing, political, whatever it needs to explain away the sentiment of the real players... the fact is Gold is a commodity traded by traders, and they move the market... follow what they follow ... I thunk...

Cheep cheep
..................Kauri

and still... impulsively going down?? Oh what a feeling..

Cheers
............Kauri

 

[Sean K]

It's been an interesting spell for gold with most of the enables for gold support still evident in the market. Record oil, Inflation on the up, USD record lows, Geopolitics still shakey....so what's going on? Is the market thinking that the above factors are about to turn around with the chance that the US has finished lowering rates and's going to fix their economy? Gold is forward looking for the economy? Or, just a correction that we had to have after the rediculous run from the $700s to 1000 in a few weeks.

 

[Whiskers]

and still... impulsively going down?? Oh what a feeling..

Cheers
............Kauri

Is this a good enough head and shoulders.

750's here we come.

Every one bailing out to grab some USD.

 

[explod]

It's been an interesting spell for gold with most of the enables for gold support still evident in the market. Record oil, Inflation on the up, USD record lows, Geopolitics still shakey....so what's going on? Is the market thinking that the above factors are about to turn around with the chance that the US has finished lowering rates and's going to fix their economy? Gold is forward looking for the economy? Or, just a correction that we had to have after the rediculous run from the $700s to 1000 in a few weeks.

Dont' you believe that gold is political and is therefore being manipulated. We have pointed out this fact with the reasoning time and again. Only last week I stated that untill the US Presidential election gold will move up little.

It is interestingly at the last line of support which I felt would hold. We will see. A great buying opportunity.

But most certainly the correction was well overdue.

 

[Sean K]

Dont' you believe that gold is political and is therefore being manipulated. We have pointed out this fact with the reasoning time and again.

You musn't have convinced me obviously. : I better go back to the drawing board I suppose....

 

[Kauri]

You musn't have convinced me obviously. : I better go back to the drawing board I suppose....

Got me rethinking too... after all, although Rumours are frowned on here...I hear that the Niue Governments PPT is considering a mass dump of their leased Gold reserves as they want to decouple from the $US influence on their exports... so watch out below..
Slanty
..........Kurrie...