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Subject:  Re: Gold - Updated TA Date:  8/20/2012  12:19 PM
Author:  MDCigan Number:  41157 of 41373

Any updated thoughts on Gold. The ascending triangle and the secular bull of last 3 or 5 year period is gone and we are now in sideways consolidation (I am pretty sure, I have no idea what the above means!).

The last time Gold had a lengthy sideways move is from Apr-06 to Aug-07, and then the world started collapsing and printing presses worked non-stop and gold hit the peak.

Is gold now tied to QEIII? If there is no QEIII are we looking at Gold breaking down 1500 mark? It bounced off of that low multiple times in May and then recently at 1555.

There is no catalyst to buy gold unless we are assured of another round of easing by FED.

Interested in your thoughts.


Actually, pretty good read there for having no idea what it means.... :) although by my definition the secular bull starts in 2001, not 3 or 5 years ago and is still ongoing until proven otherwise. Right now, we are only 16% off the 1924 peak achieved in Sep 2011. How many times did the S&P 500 drop 15%+ during the secular bull of 1982-2000?

At present, I am in neutral wait and see mode with gold to see which way this sideways consolidation resolves itself. I currently have no positions in gold at all, no long-term investment position, and no short-term trading position. I do have a short position in silver that is at a moderate loss as I shorted at 26.89 expecting an imminent breakdown below the $26 support level, but it looks like I am going to get stopped out this week. Fundamentally, I'm surprised to see silver hold up this well given that it is an industrial metal as well, but depending on what happens the rest of this week, it may break above the downtrend line off the $50 top of April 2011. Probably a mistake on my part to trade along with mass sentiment. I can't find the chart now, but it basically showed that bearish sentiment on silver was at the same level as October 2008.

I haven't been able to get the gold sentiment numbers recently, but I'd guess they are probably close to the silver numbers so sentiment is likely very bearish which is contrarian bullish. I think it is also bullish that the 1525-1535 support level has held and that over the last 3-4 months price has slowly been working higher putting in a sequence of higher lows. Also, on the bull side is the fact that the signal line crossed above on the weekly MACD. In my experience, quite oft