Tuesday, 26 November 2013

Gold charts still bearish 2013-11-26. Gold retook $1251 for a monent on Monday then back down.

Charts for today Monday 25th November 2013 showing inverted Swiss Stairs formation and also the upmove ingold today that threatens to retake $1251. The $1222 low is not surprising, since it is right on the centre line of the downtrending pitchfork that starts in September 2012.

The usual suspects are spouting their usual nonsense about the sellers selling 'uneconomically' in gold by selling largish tranches at a time.

However, they are incorrect. The chart clearly shows a kind of reverse Swiss Stairs formation in gold, except that the flat parts of the stairs are uptrending choppy action.

The sellers are allowing the bulls to take the price up before they sell each tranch. As soon as the price reaches resistance, they sell another lot. Does this imply that there is a very large seller unloading a very large position in tranches?

Fascinatingly, the upsloping lines are exactly parellel to the support line for the late June to August rally from $1180 to $1434.

These lines sees choppy upside action along them.

Every upsloping line in the chart linked from here is a support line that becomes resistance and then there is a markdown. This has been true for all the action since the red arrow at $1376.
These guys are getting a decent price for their gold that they are selling.

However, gold is challenging the key $1251 level right now, this very moment, on Monday 25 November 2013 at 20:25 GMT

Note how the downtrends are getting steeper, fortunately each one is slightly shorter than the last but the point to targets at $1100 and $950:

Trying to put a potential path to $950 on the chart respecting the downtrends and lines of support and resistance:


As of Tuesday, gold made it to 1253 then turned straight down again! Not at all surprising.

Kitco confirms the bear market psychology by having the headline:
"Comex Gold Sees Corrective Technical Bounce And Short Covering - Kitco News, Nov 26 2013 8:21AM"

This is the first time I remember seeing the phrase corrective bounce used, ie a counter trend move in a bear market .

It's all in the US dollar. On that bounce in gold, the US dollar went from going up to going down, now it is going up again and gold has tuend down quite sharply, an unbroken line of seven red 20 minute bars or candles on the chart as I write on Tuesday at 1730 GMT. A couple of minutes later, we get the first blue candle on the 20 min chart for over 2 hours!

I also posted a siilar comment on Korelin Economics Report.

No comments: