Gold Price - Where is it heading?

[solomon]

Thanks explod for taking the time to educate me. So what you are saying is that the AUD price of an ounce of gold has gone up (or at least held stable) recently (despite what is happening to the USD price of gold), thanks to AUD depreciation.

 

[refined silver]

Thank heavens for that!

The USD has finally spiked up to the underside of its long term downtrend, burning a few shorts in the process.

My guess, is that is pretty much the USD rally topped out as fundamentals and long term TA take over, and at the same time gold has now hit its downside H&S target.

If you step back a bit things are always clearer.

 

[explod]

Bean, you could be the accurate one, after the latest action on the weekly we are forming a head and shoulders and could correct to support at $US640

Which would take us just past the US Presidential election. Look out below.

 

[Sean K]

Bean, you could be the accurate one, after the latest action on the weekly we are forming a head and shoulders and could correct to support at $US640

Which would take us just past the US Presidential election. Look out below.

Bean predicted a bottom in Gold stocks for last Friday...

Which H&S explod? The last one on the chart gave a target of around $850 ish.

Or, is this the one you mean?

 

[explod]

However, (re above) and having a step back. We could expect strong support at around $US800 where we would complete a nice daily chart head and shoulders in about a month.

Of course anything is possible, and a look at the US dollar (as indicated by Refined Silver) will indicate that it is the key at this time. Keeping it strong will be the task of the Plunge Protection Team till Novemeber.

We live in most interesting times.

And RF, how do you post that chart. Have been trying for eons but says it takes too many killer bites and wont' go.

 

[explod]

Bean predicted a bottom in Gold stocks for last Friday...

Which H&S explod? The last one on the chart gave a target of around $850 ish.

Or, is this the one you mean?

Last year he said about $US600 and he was boo hoo ed off the stage.

Bring it on Bean.

 

[bean]

Do we have a massive H & S on the HUI
Will there be panic selling soon in the Gold stocks as the HUI breaks down under 380. Sellers believe the Gold Bull is over?
View attachment 22796

So that was on the 30th July HUI gold index was about 400.
Today's close 313.99.

Friday I said may have a short term bottom in POG but there was no bounce from US$ 869 and did mention That if that gave on the POG would be very bearish for HUI which has dropped over 12% last two days

For interest
POG has been down 7 days straight
longest run is 9 days

Those that believe OIL was in a bubble and Oil and Gold are aligned.

extract from 'Rick Picks' commentary

"If we sound churlish over the thrashing that precious metals have received in recent weeks, it is not because it took us by surprise. In fact, Rick’s Picks has provided a series of downbeat forecasts for gold and silver all the way down, and there is yet one more querulous target to be achieved that lies beneath even the 824.50 nadir of yesterday’s insensate plunge. There is also to consider a worst-case fantasy target of sorts that we disseminated yesterday in the chat room: $654. It is based on the price of gold following crude oil all the way to the bottom of its presumptive bear market. We’ve repeatedly said that oil prices are not correcting but crashing, and this would imply they will be at least cut in half from the $148 peak recorded in mid-July. So what would $74 crude mean for gold? Well, if bullion were to continue falling 60% as steeply as oil, which is what it’s done since crude prices began their collapse nearly a month ago, it would imply a $654 low for gold."

 

[cuttlefish]

Definitely an interesting technical zone for gold and at the moment not looking too promising having broken down through the $840 level and now testing the top of the $780-$820 band of support. The sharpness of the moves down certainly makes it look weak on the charts.

If it gets down below $750 and stays there for a prolonged period of time (3 months+) we'll start to see quite a few production operations getting shut down as well as dramatically reduced exploration and development expenditure (plenty of projects currently in the development pipeline willl get put on hold if this eventuates) reducing the supply side and providing a good fundamental basis for the next move upwards.

As it moves down further I'm starting to accept the case that now may not be the time for gold and it might be a matter of coming back mid next year but I'm not quite there yet.

I still think gold is capable of phenomenal suprises to the upside because its the counter to the USD and the USD could capitulate if there are more icebergs. It does seem like a lot of the dirty laundry is getting an airing at the moment with the CNN reports headlining with possible multi-trillion dollar losses from the credit crisis but that doesn't mean the real fundamental impact of such large losses has worked its way through the system yet. We're also seeing banks taking the hit on various worthless paper so maybe we're starting to at least get visibility of the full extent of the problem - that is a milestone in itself but the losses still have to work their way through and get digested which will mean a lot more money being printed along the way.

 

[cuttlefish]

... but the gold price itself I think might be ready to move back up into the $900's over the next few months and maybe even tackle the $1000 level again as we head into xmas ... If it made a decisive move down below the $820 sort of area I'd revise that outlook.

And just referring back to my post from the other day - its already moved down below where I was hoping it would find support - looking like the fall through $820 might be iminent but not quite there yet - a fall through and bounce back up off $780 to consolidate again in the $780/$820 band would still have me neutral to bullish short to medium term, but the momentum built up with the current falls is concerning.

 

[GreatPig]

Here's a weekly chart of the ASX GOLD stock.

Interesting the way it's been moving between the Fib levels recently.

GP

 

[Whiskers]

Here's a weekly chart of the ASX GOLD stock.

Interesting the way it's been moving between the Fib levels recently.

GP

Gaud, I'm seeing EW waves in everything now.

GreatPig, I'd say that's the effect of the AUD falling at a faster rate than the USD rising.


I gather some of you are tipping the USDX to break down at the trend line... about where it is now.

I'm gonna say the USDX has put in a bottom.

Minor leg 1 is about complete, 2 should come back to around 75 - 76.

The first 5 minor waves should take it well into the 80's.

BUT, although I havn't completely figured the big picture in terms of EW it seems to me that even if this is a corrective leg on the way down, I think it could still get into the 90 to 100 range in the months or year ahead.

 

[kbxk508]

The gold sector is experiencing a sharp bull-market correction, but in any case the rally that follows the current steep decline should retrace a big chunk of the decline REGARDLESS of whether or not the bull market remains intact.

kbxk508

 

[Whiskers]

I'm gonna say the USDX has put in a bottom.

Minor leg 1 is about complete, 2 should come back to around 75 - 76.

The first 5 minor waves should take it well into the 80's.

BUT, although I havn't completely figured the big picture in terms of EW it seems to me that even if this is a corrective leg on the way down, I think it could still get into the 90 to 100 range in the months or year ahead.

I forgot to mention the significance of this to the POG.

I think the mass exodus from previous positions has pretty well finished now and everyone will settle into the reasilation of low oil, the US economy turning around, probable inflationary pressure and rising USD.

I reckon 800'sh is the bottom for the POG and it will zig zag back up into about the mid 900's again over the next few weeks or months.

I'll see if I can come up with a number over the next week or soo.

 

[steven1234]

There was a fair amount of de hedging by gold miners to take advantage of a rising gold price. Could they have been wrong in their analysis of the gold price? Surely they must have a better idea of gold price movements than your average punter.

This article believes that gold dehedging will now dramatically slow. http://www.mineweb.com/mineweb/view/mineweb/en/page33?oid=59379&sn=Detail

Whiskers, that was a great call you made on Sunday 10/08/08 for gold to bottom at 801.

 

[bean]

For interest
POG has been down 8 days straight
longest run is 9 days

 

[explod]

Whiskers, that was a great call you made on Sunday 10/08/08 for gold to bottom at 801.

Yep, agree. And the action today indicates we are on the way back up.

But expect anything.

 

[M34N]

Yep, agree. And the action today indicates we are on the way back up.

But expect anything.

So true, well done to Whiskers for picking it, phenomenal.

I forgot to mention the significance of this to the POG.

I think the mass exodus from previous positions has pretty well finished now and everyone will settle into the reasilation of low oil, the US economy turning around, probable inflationary pressure and rising USD.

I reckon 800'sh is the bottom for the POG and it will zig zag back up into about the mid 900's again over the next few weeks or months.

I'll see if I can come up with a number over the next week or soo.

I dare anyone to doubt you now

So you predict a rising US dollar and rising POG? Or are you saying a short term retrace back up for gold to mid-900's, then back down after that?

 

[bean]

Interesting POG has to over next couple of days reach X or its down another US$50 or so in quick time.

However lets hope its up for a few weeks before plunging

 

[Whiskers]

So true, well done to Whiskers for picking it, phenomenal.

Well thanks fellas, but that one was pretty simple cos it played neatly by the rules. My FA confirmed the move, but my new-found interest in EW has enabled me to time and quantify it much better.

But whatever you do, don't put your life savings on my forecasts, cos I'm greener than a cucumber at this EW stuff... and only just getting the hang of proof reading my wave count.

I'm sure there are more experienced technicans out there who saw it coming too. I'm still learning this EW stuff and only posting the numbers to keep a record of my estimates and forecasts.

The real test will come when the wave structures get into some of the more complicated and ambigious moves.

I dare anyone to doubt you now

So you predict a rising US dollar and rising POG? Or are you saying a short term retrace back up for gold to mid-900's, then back down after that?

My most favoured position at the moment is that this is the end of a significant correction and it'll be generally up from here for quite awhile... mind you though, some of the minor wave corrections along the way may be pretty savage.

The caveat, (due to my relative inexperience) my less likely possibility, is that this is not the end of significant wave C, but a lower degree wave 1 of 3, in which case it would kick up for a few days or so and revisit the 800 level support and momentarily break it to finish wave C, as bean suggests, before pushing upwards to new highs.

 

[BentRod]

Gold is looking like a nice short on breach of around $800.