Gold Price - Where is it heading?

[wavepicker]

Gold has dipped under US$600/oz

There is nothing surprising here.

As per post back in June :

https://www.aussiestockforums.com/forums/showpost.php?p=51418&postcount=559

refer to forcasted EW chart back then. Three waves always unfold against the one larger trend. In this case the one larger trend was up for 6 years.

This bear campaign/correction in Gold IMO is not even half done in terms of time. Tentative downside target is $480/490. But could also be as low as $430/450. Will get better idea as that time approaches.

5 waves down in the US Dollar since 2000. The rally it started in Dec 2004 is unfinished. Would expect a multi year advance from here. IMO opinion Gold will be doing it hard. The biggest factor in the strength of Gold price has been due to US Dollar weakness more than anything.

The consensus among maintream economists and analysts is that the US Dollar is doomed and that Gold will continue to rise. This is not the sort of sentiment conducive to a continuation of the Gold bull at this point in time. When 95% of the bulls are washed out of the market, that is when Gold will regain it's footing and use this decline as springboard to higher prices in the years ahead.

 

[scsl]

I got this from CMC Markets' live news feed...

NEW YORK (Dow Jones)--Despite the recent sell-off in gold along with the rest of the commodities complex, analysts at Goldman Sachs expect a weakening in the U.S. dollar to support a substantially higher gold price by the end of next year.

In a report released late Monday, the analysts said the fundamental equilibrating relationship between gold and the dollar continues to show strong signs of having returned after a structural adjustment higher.

"Moreover, we continue to see risks to net central bank sales, while mine production is unlikely to recover substantially in the near term," analysts said in the report.

Accordingly, Goldman Sachs is maintaining its forecast for gold prices to average $785 an ounce in 2007, "though this forecast would be at risk should the expected dollar weakening not materialize," they added.

-By Alison Guerriere Ciaccio

 

[ducati916]

Re: GOLD Where is it heading?

ducati
The numbers are not my numbers - they are there for anyone that goes to the Wold Gold Council site.
You continue to blur money with physical - there is a link but the two data sets need to be interpreted separately.
A key driver of gold's price into the future will be mine supply falling significantly short of physical demand.
How many commodities are there in such short supply and of such value that banks have to release supplies to the market, and individuals are willing to sell their jewellery (so it can be melted down) for cash.
Yes ducati, I did PM you and ask you to revise your gold forecasts.
I have little doubt that by October this year we will have $800 gold.
I also know that the next major retrace is likely to be more severe than the present one.
I remain a conservative gold bull at this stage, but I also like to keep my position intelligible and simple.

Well, October is fast approaching.
$800 Gold nowhere in sight.
$400 Gold getting closer week by week.

jog on
d998

 

[nizar]

Re: GOLD Where is it heading?

Well, October is fast approaching.
$800 Gold nowhere in sight.
$400 Gold getting closer week by week.

jog on
d998

Gold went from 600 to 700 in one month back in april/may
It that happens again it will be at about 680, still off from 800, but that will still make rederob alot closer than u...

 

[ducati916]

Gold went from 600 to 700 in one month back in april/may
It that happens again it will be at about 680, still off from 800, but that will still make rederob alot closer than u...

*Closer*
An interesting word.

The two predictions, as that of course is in essence all they were;
$800...........October
Currently, not looking too promising.

Whereas, my prediction;
$350 - $450...................sometime in the future
Looks far more conservative

And that is the lesson.
Be conservative;

*of capital
*of optimism
*of pessimisim
*of expectations

jog on
d998

 

[wavepicker]

Gold Should find support at current levels or marginally under @$570.
This should give rise to a rally in an EW wave C of this current sideways pattern. Target: approx $650 before heading south again

 

[YOUNG_TRADER]

Won't central bank selling keep a lid on price until the deadline of 24th/25th Sept passes?

 

[scsl]

Do any of you think gold is on its way up towards $650 again? Or will this bounce off $580 be short lived, with more 'correcting' to be done at the $570-580 level?

Cheers,
scsl

 

[Sean K]

Gold needs to positively break $640 imo for there to be a new upward trend. At the moment, it's found a solid base around $560/70 which has been tested twice, but has lower highs occurring.

 

[scsl]

Interesting article I found on Dow Jones Newswires, on gold/oil/dollar correlation, dated 3 October 2006:

NEW YORK (Dow Jones)--Gold has recently been taking daily direction from the oil market, while the traditional gold/dollar relationship has faded, said John Hill, an analyst at Citigroup Inc. (C) in a report released Monday.
"Gold correlations are always murky, and famously unstable over time," said Hill, who added that while the oil/gold correlation is likely to continue, it won't be without instability.
He said the oil link reflects the "ebb and flow of investment in broad commodity indices, and the anomalous pull from pro-cyclical basic materials during a period where gold's safe-haven attributes are in abeyance."
Gold's weaker link to the dollar probably reflects no more than a misplaced consensus bearish call on the dollar in the first half of 2006, said Hill. While a weaker dollar is normally positive for gold, he said, a more powerful secular theme is the possibility of a stealth cycle of competitive devaluations, driven by trade imbalances, demographics and entitlement bloat, which would have the effect of boosting hard assets and gold in all currencies.
Meanwhile, said Hill, the historical correlation between the dollar and gold has seen a decoupling again.
"A strong gold, dollar correlation was briefly reasserted in second quarter of 2006 only to fade again in the third quarter," he said. "The latest decoupling is dissimilar to fourth quarter of 2005, when gold rose sharply against the dollar, euro, and yen."
For the gold/oil correlation, Citigroup forecasts West Texas Intermediate crude oil at $55 a barrel in 2008 and gold at $750 an ounce.
"We expect the gold/oil relationship to remain unstable," said Hill. "Economic slowdown or recession scenarios would likely dampen energy demand, while spurring safe-haven gold buying. Geopolitical tension scenarios would probably boost both."

 

[wayneL]

Dec. del. dipping under $600 once again. "So far" we are running against the seasonal tendency... whatever that means for the immediate future.

 

[brerwallabi]

This is scary looks ike the bears have Goldilocks in their jaws.

 

[wayneL]

 

[wayneL]

I was about to post a chart, but she's not finished tanking yet... later.

disclaimer: I'm long a few ounces via ETFs

 

[Sean K]

Hhhmmm, I thought the N Korea news would have pushed it up...Support still around $575. 120% up on the year. Hardly tanking yet. Iran will be in there soon talking about stoping the oil flowing after Condi's remarks.

 

[wayneL]

I was about to post a chart, but she's not finished tanking yet... later.

This could be the bottom of the pool...

...for today.

 

[nizar]

Hhhmmm, I thought the N Korea news would have pushed it up...Support still around $575. 120% up on the year. Hardly tanking yet. Iran will be in there soon talking about stoping the oil flowing after Condi's remarks.

Gold started the year 120% lower than where it is now??
Im pretty sure it started at $519...

 

[wayneL]

The pits closed the Dec contract @ 581.30 and been down < 580 on electronic.

I have a level at 576 which could be support for this week, but looks dreadful on the daily.

Goldilocks doesn't like gold

OIL caught in the vortex as well.

 

[Nick Radge]

Here is my analysis posted last night...bit of luck I think...

BOTTOM LINE
3/10:
EW Trend: Down
Price Trend: Down
Trend Strength: Weak
Broker Consensus: n/a
18/9:
EW Trend: Down
Price Trend: Down
Trend Strength: Weak
Broker Consensus: n/a

LAYMANS ANALYSIS
3/10:
VIDEO ANALYSIS (1 mins 37 secs)
The gap just below the critical $609 level has all but been filled and prices may now well be ready to continue lower. I would anticipate that we'll see prices attempt to probe below the $571 lows made mid-last month. This support zone below between $540 and $580 is going to take some hard work to get through, but slowly but surely we're chipping away at it. Volume does appear to be drying up again, so any decline would ideally be accompanied by increasing volume. If we do see a test down through those lows, I would then expect another reasonable bounce before breaking lower once and for all. For this bearish analysis to be invalidated, I would require a move back through $609 initially then back through $670. I cannot get bullish at this stage prices push back through there.
18/9:
VIDEO ANALYSIS (2 mins 2 secs)
Prices briefly moved above $629 before plunging on rumored Central Bank selling. The move back below the July/August lows has returned Gold to the larger down trend that we've been following over the last few months. Notice now that we have this gap just above prices - very odd indeed to see such a well defined gap. It's like some weird vacuum area that prices don't wish to go. In the last review, when prices were above this gap, I noted it as being "gap support". Obviously with prices now below this area it becomes "gap resistance". We hear and see it often; old support becomes new resistance. The area of interest to me now is $609. A break back through there will again place a clear picture in doubt so to continue with clearest bearish analysis I'd like to see prices remain below $609.

TECHNICAL DISCUSSION
3/10:
We anticipated the gap to be filled as part of the unfolding wave-iv. Now that this has occurred, the ideal scenario is that wave-v will trace out deep into that support zone. The 61.8x wave-iii targets $533, which I think is a bit keen at this stage, although anything is possible. A more credible target is the wave-i/wave-v equilibrium at $560 which sits right in the middle of the zone. The end of this minor degree wave-v will also be the terminal point for the intermediate degree wave-(iii). Interestingly enough the expected wave-(iii), which can be calculated by 61.8x wave-(i), is $563, just a few dollars from the Fibonacci extension above. The minor degree count is invalidated above $609.
18/9:
A key component of this chart is that a wave-2 cannot form as a triangle. You can see a large triangle recently which has broken to the downside. The highest probable count is one suggesting a larger wave-2 on 14th July, an intermediate degree wave-(ii) on 2nd August and a minor degree wave-ii on 5th September. This sequence is known as "nesting" and in turn shows why $609 is of interest to me now. A break back above $609 will invalidate the lower degree structure and in turn place doubt on the larger degree counts. It will not invalidate the bearish view but will suggest some other more complex corrective pattern is underway. The risk right here is that gap area just above may be filled as part of the minor degree wave-iv correction. If it does fill and not move back above $609 then we have a very strong selling area for the continued move lower. Friday's prices just probed briefly into the major support zone from $540 - $580. It's going to be a hard grind to get through.

 

[Sean K]

Gold started the year 120% lower than where it is now??
Im pretty sure it started at $519...

From this time last year. A year ago. One year.

Sorry that was so confusing.