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From: | "Baa Baa" <baa_baa@hotmail.com> |
Date: | Mon, 26 Jan 2004 10:54:35 +0000 |
Price of Gold (POG), in USD. Still keying off the USD, although increasingly the Euro too, the POG remains in a corrective phase from 6/1/04 $428 high. This correction has retested and failed at the high, eased quickly to 417 then gapped down to close at 408 on 15/1, followed the day after by a first test on the 50MA around 405. Last week, the POG range traded between 413 and 408, but, today (Aus/Asia) on renewed USD strength, tested and broke the 50MA moving to 404.50 - currently about 406. This could be either wave 5 of A down, or more likely wave 3 of A down. Some might consider the leading US mining stocks as a lead indicator, esp the mid/large cap NA's in the HUI, for example BGO, & NEM, both of which are well advanced in their correction (anticipated gold weakness). Price action since the 13/1/04 is in a well formed PDT (power down trend). Key indicators show weakness -%R in oversold, STO perked up, but has crossed over again to ovesold, MACD oversold and recrossing MTM/CCI weakening. Volume has risen but in the sell side. Projections: Plan A - assuming USD strength continues (my TA on USDX says 89-94 range is target resistance trendline - currently 86.5), then, expect to see the POG 100MA at $395 and that'll be enough to spook the weak hands for a retest of the all important S2 line at 378, and below that the 200MA about 373 ... always a strong. Response: Buy progressively into weakness, accelerating accumulation as each support fails and if a turn occurs, convert all dry powder for the ride back up. Plan B - assuming USD weakens, unlikely imo, but anything can happen and often does. Look for key resistance at 413 and gap filler at 417. I hate buying strength, but if it pops through 425, pile in but keep a finger on the sell trigger. If 428 falls, hang on for the ride. I am using a 5SMA/14EMA crossover to confirm the trend change. Finally, "bear" in mind the 'Prechter Zone'. Widely maligned the perennial bears insist the failure at 428 was a 8 year top -wave 5 or (5) of [C]circled, which in english is OUCH! The Prechter zone for the current move is $50-$75 decline to the range 377-353 (ergo the 200MA!). Alternatively, consider the Sinclair zone ... somewhere near the moon, but even Jim is suggesting a decent correction if we can't break out of the trading range to the upside This Week.. JMO, BAA _________________________________________________________________ Find your perfect match @ http://personals.xtramsn.co.nz with XtraMSN Personals! ---------------------------------------------------------------------------- To remove yourself from this list, please use the form at http://www.sharechat.co.nz/chat/forum/
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