Well, I'm sorry to say that it wasn't a good week for the gold bulls as all three of the precious metals advance/decline lines that we follow at Technical Watch moved to lower levels without providing price divergence. More troubling though is that the Yahoo 30 XAU advance/decline line, which has shown good leadership at market turns in the past, actually moved to new lows on Wednesday. Because of these new lows, we now have three fan formation lines of resistance above current levels, and with the McClellan Summation Indexes of both breadth and volume at around the -1250/-1300 level for this basket of stocks, this would highly suggest that we're at least a month or two away from seeing a price a bottom in the metals complex.
As a reminder, we still have a longer term .618 target in gold of $1156 (+/- $20.00) on a closing basis still in play here, and if the other two precious metals A/D lines follow the lead of the Yahoo 30, there's an excellent chance that we'll see gold move to or towards this Fibonacci target level before seeing the actual bottom.
Fib
Better to ignore me than abhor me.
“Wise men don't need advice. Fools won't take it” - Benjamin Franklin
"Beware of false knowledge; it is more dangerous than ignorance" - George Bernard Shaw
Demagogue: A leader who makes use of popular prejudices, false claims and promises in order to gain power.
Technical Watch Subscriptions
