Gold: Short Term Forecast

Gold (GLD) may rise slightly into the election … then pivot down.

If gold and silver are the safe havens, why have they not moved higher as the overall market has declined?

Years ago, literally decades ago, Robert Prechter proposed ‘it’s all the same market’.  Meaning, everything is connected and nothing moves independent.

Sufficient evidence has been proposed on this site, that potential exists for deflation first, then inflation.

Continuing on with Prechter, he states that any significant directional move (major reversal) won’t happen until nearly every market participant is on the wrong side of the trade.

It’s easy to see who is on the (potential) wrong side of the trade for gold and silver.  Just one glance at YouTube reveals hoards, buying into the hyperinflation argument.

Sometimes the hoard is correct … but not very often.

Getting back to gold and GLD.  An expandable version of the chart is here.

Price action penetrated minor support and generated a Wyckoff spring condition.

This past Friday’s action opened gap-higher and declined to test the support level.

The expectation is for higher action into the election. 

How price behaves at the trend-lines shown (if and when contact is made) will indicate whether or not it’s in position to reverse lower or head higher to the 180 – 181, area.

Price action itself decides the next likely course.

Should there be a reversal, there are numerous ways to position (not a recommendation, not advice) for a decline.  Inverse funds DUST, JDST, and ZSL are just a few vehicles available.

Charts by StockCharts

Note:  Posts on this site are for education purposes only.  They provide one firm’s insight on the markets.  Not investment advice.  See additional disclaimer here.

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  1. Pingback: Before The Open « The Danger Point

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