Best of the Week
Most Popular
1. Stock Markets and the History Chart of the End of the World (With Presidential Cycles) - 28th Aug 20
2.Google, Apple, Amazon, Facebook... AI Tech Stocks Buying Levels and Valuations Q3 2020 - 31st Aug 20
3.The Inflation Mega-trend is Going Hyper! - 11th Sep 20
4.Is this the End of Capitalism? - 13th Sep 20
5.What's Driving Gold, Silver and What's Next? - 3rd Sep 20
6.QE4EVER! - 9th Sep 20
7.Gold Price Trend Forecast Analysis - Part1 - 7th Sep 20
8.The Fed May “Cause” The Next Stock Market Crash - 3rd Sep 20
9.Bitcoin Price Crash - You Will be Suprised What Happens Next - 7th Sep 20
10.NVIDIA Stock Price Soars on RTX 3000 Cornering the GPU Market for next 2 years! - 3rd Sep 20
Last 7 days
Pre-COVID US Economy Wasn’t All That Great Either - 4th Dec 20
Bitcoin Breath Taking Surge - Crypto Trading Event - 4th Dec 20
Platinum Begins A New Rally – Gold & Silver Will Follow - 4th Dec 20
Don't Let the Silver (and Gold) Bull Shake You Off! - 4th Dec 20
Stronger Risk Appetite Sends Gold below $1,800 - 4th Dec 20
A new “miracle compound” is set to take over the biotech market - 4th Dec 20
Eiro-group Review –The power of trading education - 4th Dec 20
Early Investors set to win big as FDA fast-tracks this ancient medicine - 3rd Dec 20
New PC System Switch On, Where's Windows 10 Licence Key? Overclockers UK OEM Review (5) - 3rd Dec 20
Poundland Budget Christmas Decorations Shopping 2020 to Beat the Corona Economic Depression - 3rd Dec 20
What is the right type of insurance for you, and how do you find it? - 3rd Dec 20
What Are the 3 Stocks That Will Benefit from Covid-19? - 3rd Dec 20
Gold & the USDX: Correlations - 2nd Dec 20
How An Ancient Medicine Is Taking On The $16 Trillion Pharmaceutical Industry - 2nd Dec 20
Amazon Black Friday vs Prime Day vs Cyber Monday, Which are Real or Fake Sales - 1st Dec 20
The No.1 Biotech Stock for 2021 - 1st Dec 20
Stocks Bears Last Chance Before Market Rally To SPX 4200 In 2021 - 1st Dec 20
Globalists Poised for a “Great Reset” – Any Role for Gold? - 1st Dec 20
How to Get FREE REAL Christmas Tree 2020! Easy DIY Money Saving - 1st Dec 20
The Truth About “6G” - 30th Nov 20
Ancient Aztec Secret Could Lead To A $6.9 Billion Biotech Breakthrough - 30th Nov 20
AMD Ryzen Zen 3 NO UK MSRP Stock - 5600x, 5800x, 5900x 5950x Selling at DOUBLE FAKE MSRP Prices - 29th Nov 20
Stock Market Short-term Decision Time - 29th Nov 20
Look at These 2 Big Warning Signs for the U.S. Economy - 29th Nov 20
Dow Stock Market Short-term and Long-term Trend Analysis - 28th Nov 20
How To Spot The End Of An Excess Market Trend Phase – Part II - 28th Nov 20
BLOCKCHAIN INVESTMENT PRIMER - 28th Nov 20
The Gold Stocks Correction is Maturing - 28th Nov 20
Biden and Yellen Pushed Gold Price Down to $1,800 - 28th Nov 20
Sheffield Christmas Lights 2020 - Peace Gardens vs 2019 and 2018 - 28th Nov 20

Market Oracle FREE Newsletter

FIRST ACCESS to Nadeem Walayat’s Analysis and Trend Forecasts

Gold Disaster Ahead?

Commodities / Gold & Silver 2009 Dec 20, 2009 - 06:49 AM GMT

By: Merv_Burak

Commodities

Best Financial Markets Analysis ArticleThursday was a bummer. Is there a disaster ahead? The "blow-off" is continuing as expected but for how long? Questions, questions, but do we have any answers? Let's see.


GOLD : LONG TERM

Despite the continuing downside move in gold, since the "blow-off" the long term indicators have still not been affected. The long term P&F chart has been affected but has not yet given a bear signal as I require two things to happen, the action to drop below two previous bottoms (which has happened) AND the action to move below the basic up trend line (which has not yet happened). The most that can be said about the P&F chart is that it is giving a strong warning that the long term may be getting ready to be in trouble. A move on the P&F chart to the $1050 level would provide the bear signal.

As for the normal indicators, they are still in good shape. The gold price is still well above its long term positive sloping moving average line (which is presently just below the $1030 level) and the momentum indicator remains in its positive zone. The indicator is, however, heading lower and is below its negative trigger line for a warning (similar to the warning the P&F chart is giving). The volume indicator is also moving lower but remains above its positive sloping trigger line. From all this the long term rating remains BULLISH.

INTERMEDIATE TERM

Two weeks back I called the intermediate term up trend as ended based upon my FAN Principle Trend Lines. That Friday's action had closed below the third FAN trend line (trend line shown and often referred to as a blow-off trend) and based upon my FAN Principle the trend was over. As mentioned, this is one of the few indicators that I use that provides a reversal signal very early in a trend reversal. The normal indicators take more time to develop and have not yet fully caught up with the FAN blow-off signal.

We are also starting to get warnings on the intermediate term trend but not yet critical. The Thursday's action did take gold below its intermediate term moving average line, where it remains on the Friday close. The line, however, is still pointing upwards. The momentum indicator is moving towards its neutral line but remains in its positive zone. As with the long term, the indicator is below its trigger line and the trigger is rapidly moving downward. As for the volume indicator, it has just moved below its trigger line although the trigger is still in an upward slope. The intermediate term rating has weakened and is now at the - NEUTRAL level, one notch above a full bear rating based upon the normal indicators. Any further down moves by gold and the moving average might turn downward. That would then bring us to a full bear. The short term moving average is still above the intermediate term average so there is no confirmation of any bear yet from these indicators.

SHORT TERM

Although the indicators had been weakening since the FAN break down the actual short term rating did not go bearish until last week. It remains so this week. The gold price remains below its downward sloping moving average line and the momentum indicator is in its negative zone below a negative trigger line. The daily volume action is low and does not tell us anything at this time. The short term rating remains BEARISH.

As for the immediate direction of least resistance, that's always a difficult item to determine over a week-end. Much can happen in two or three days. Although the Stochastic Oscillator is still in its negative zone it seems like it wants to go positive. The Friday action might suggest that the previous plunge in price may have been overdone and a bounce may be expected. I'll go with my most popular direction of choice, the lateral direction, for another day.

SILVER

Over the past three months the silver action has traced out an expanding upward sloping megaphone pattern. These megaphone patterns suggest indecision on the part of speculators as to which way to go next. An upward sloping megaphone, unfortunately, too often (but not always) suggests an eventual break on the down side. This is something to keep an eye on over the next while. Otherwise, silver is acting much like gold but not as forcefully on the down side.

PRECIOUS METAL STOCKS

The major North American stock indices have all been in a dumper this past week with losses in the order of 3% to 3.5%. The Merv's Indices have been somewhat better with only the quality Indices showing losses. The more aggressive Indices are all showing gains for the week. As long as speculators are not dumping their more speculative stocks one can continue to have faith that the bullish stock trend still has a way to go and that these past couple of weeks are only part of a rest period before the next surge.

HOLIDAY POSTINGS

It's the holiday time so the commentaries may be somewhat limited over the next few weeks. I expect to post the commentaries each week-end but they will be short.

Here's wishing everyone a very Merry Christmas and a Prosperous New Year.

MERV'S PRECIOUS METALS INDICES TABLE

Well, I think I'll call it another week.

By Merv Burak, CMT
Hudson Aero/Systems Inc.
Technical Information Group
for Merv's Precious Metals Central

For DAILY Uranium stock commentary and WEEKLY Uranium market update check out my new Technically Uranium with Merv blog at http://techuranium.blogspot.com .

During the day Merv practices his engineering profession as a Consulting Aerospace Engineer. Once the sun goes down and night descends upon the earth Merv dons his other hat as a Chartered Market Technician ( CMT ) and tries to decipher what's going on in the securities markets. As an underground surveyor in the gold mines of Canada 's Northwest Territories in his youth, Merv has a soft spot for the gold industry and has developed several Gold Indices reflecting different aspects of the industry. As a basically lazy individual Merv's driving focus is to KEEP IT SIMPLE .

To find out more about Merv's various Gold Indices and component stocks, please visit http://preciousmetalscentral.com . There you will find samples of the Indices and their component stocks plus other publications of interest to gold investors.

Before you invest, Always check your market timing with a Qualified Professional Market Technician

Merv Burak Archive

© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules