Thursday, December 1, 2011

Gold Update

Click on Chart to Enlarge

This is an updated chart of gold which I had posted on Nov 15th.  The green line is the typical 1st bear market rally after the first leg down off a high in gold.  The projection is to Dec 7th, which is not a magical date just the average for a high of the 1st bear market rally.  Given the current environment, it seems likely for gold to continue sideways to higher, possibly making a new rally high over the next week or so.

As a side note, there may be a significant reaction after next weekend when there is supposed to be a significant European Euro/debt meeting.  It is possible that the gold market remains rather subdued until then.  That meeting is Dec 9th, next Friday.  So a possible major shift in gold prices may coincide with some policy decision or indecision in the news on that front.

The pink line in the chart above is the bull market trendline since 2008.  If that trendline gets broken I think it will be a waterfall type decline with some dramatic losses in a relatively short time.  The next chart support below would be the 1300-1400 range.

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