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Welcome all Safety in the Market traders to this month’s dedicated newsletter. David has a saying when it comes to jumping before your entry trigger has been given, “Don’t be anticipatory stupid”. Now bringing this up right now is not a confession. I’m not about to tell you what a ‘friend’ of mine did in the last couple of weeks. What it is about is discipline, not getting caught up in ego and going with the market.
Last month we looked at Gold. The weekly trend was down and the market looked poised to ‘potentially’ form another lower weekly swing top. We basically had a straight down the line potential ABC pattern to the short side on the weekly swing chart of Gold (GC-SpotV). Chart 1 below is the up to date version of the chart from last month.
What ended up happening is that each week continued up in a higher top, higher bottom fashion and did not turn the weekly swing chart down. Point C was never confirmed and no entry trigger was ever given. The one-day swing chart stayed in a higher swing top, higher swing bottom pattern. Anybody found going short last week on anything other than an intraday signal, was being anticipatory stupid! And no, I did not get caught going short!
Chart 1 – Update Gold Chart from Last Month
click chart to enlarge
Now this is where it gets really interesting. In failing to confirm Point C on the weekly chart pattern and continuing up Gold has taken out the previous swing tops and also moved back through the $1,414.6 level which is our massive perspective, 150% Milestone. Chart 2 gives you another look at this massive range projection point of view.
Chart 2 – Gold Monthly Bar Chart – Major Bull Range Milestones Projection
click chart to enlarge
Right now I don’t want to get over the top however we are at a potential tipping point. With the Gold price moving back above $1,414.6 per ounce, we are back above the 150% pressure point. If that’s the way things stay and this level becomes some support, then we are looking higher, much higher according to theory.
Some would say the next big point would be the 175% pressure point. Not me. I’d suggest that if we see a clear break of this 150% level than $1,801 per ounce (200%) becomes a target. Now that is a huge call at this point and not so much a forecast, but a projection of what the theory says can happen and should be watched for if another strong rally gets underway, my goodness, $1,800 per ounce? It’s only theory at this stage, but it is a possibility!
Until next month...
Noel Campbell
Professional Derivatives Trader
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