Please don’t listen to the “gold smack down” cry babies, always making rationalizations or excuses, I beg of you. Don’t listen to the “gold is nothing but a stupid rock they dig out of the ground” neo hipster wise guys either. Gold just is, and the gold bug “community” makes way more of it than that, taking it to the realm of the mystical or worse, religious (as in a war of good vs. evil).
The wise guys wish gold did not exist (but it is) because it gets in the way of so many paper and digital advances and innovations (or shenanigans), not to mention boundless egghead theories about a new era of finance. Get this wise guys; we are still, each of us, bags of bones, blood and guts in some cases with high functioning brains that tend to forget that fact. We are emotional beings; humans. Gold has provided stability to emotions in the financial realm for centuries.
Other than those I have no particular views on gold, ha ha ha… it’s a monetary ‘value’ asset and a portfolio counterbalance.
Let’s check the daily, weekly and monthly charts just because I have not done so publicly in a long while. Gold daily broke upward from 2017’s sideways consolidation, establishing a nice upside marker for later. First, it had work to do after hitting its high and getting overbought amid the little rocket boy jitters. Anybody buying gold on the rocket boy (or whatever our well spoken and refined president calls him) gets what they deserve.
The retrace is heading for the 62% Fib at 1264, but a doink of the SMA 200 (1248 and rising) is very doable. Gold has gotten oversold for rallies in 2017 right around RSI 30, but with the recent overbought reading might we get a bit more oversold as the market evens things out? AROON is negative, which only tells us what we already know; it’s trending down on a daily time frame.
The weekly shows the key higher high of the daily chart in context. That context is that it is in a series of higher highs and higher lows (green shaded) out of the Dec. 2016 low. Gold rose to a very important resistance area in the upper 1300s (as we’d fully anticipated) and with rocket boy as an accelerant, surged and reversed. All normal, all good. Don’t listen to impatient cheerleaders.
What I also find interesting is a larger set of would-be higher highs and an actual higher low (blue shaded) out of the Dec. 2015 low. Folks, if at some point you see gold flying around up above 1400 it would be time to welcome into being a brand spanking new baby bull market. Right now, gold is doing the work (the labor, if you will) in order to birth it.
Finally, the monthly, which we have reviewed here publicly recently. Gold always was going to stop at the noted resistance area if for no other reason than it is the line of demarcation between a bear market and a bull market. Add in the rocket boy hysterics and well, you know.
Monthly MACD is positive, as are RSI and AROON. Gold can continue to pull back to the SMA 200 (daily chart above) and still be in wedge breakout mode. There is no guarantee gold will confirm a bull market, but let me tell you this; what is happening now is healthy, constructive and even necessary given the unhealthy rocket boy input.
So there you have it sports fans. One guy’s technical view of gold with some dogma thrown in at no extra charge.
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