Gold Bulls- Disappointed to see this taking place!
Our friend Chris Kimble from Kimble charting solutions is excellent at presenting straight froward charts. Below he outlines the Gold/USD ratio and the recent bearish reversal pattern it just put in. This is due strictly to the recent strength in the USD but did come right at a dual resistance level. Yes this is only radio but it continues the trend of gold inching higher but unable to breakout against any other market.
Click here to visit Chris’s site and at the very least consider signing up for his free email list.
…Here’s the chart and comment…
CLICK ON CHART TO ENLARGE
This chart looks at the Gold/US Dollar ratio over the past 7-years. Gold bulls want to see this ratio heading up and they get disappointing news when it falls in price.
Since 2011, the ratio started creating falling channel (1) and broke below it back in 2013. The rally that started back in 2016, saw the ratio make an attempt to climb back into falling channel (1) at (2). It tried to break back into this channel numerous times over a few months. After failing to break back into falling channel (1), it created a bearish reversal pattern 5-weeks ago and started heading lower.
The ratio is now attempting to break rising support of late at (3). If the ratio succeeds in breaking support at (3), it would send disappointing news to Gold bulls.
Gold bulls want to see strength in the ratio at (2), not continued weakness at (3).
long AXSM
Thanks for your perspective Matthew. Not quite as scary after you consider your chart. Even though gold might have some downside, it seems like the miners are starting to get a bid. Good to see ABX making an acquisition today. That bodes well for the Jrs. catching fire soon.
I agree, gold might still go lower but the miners are acting relatively bullishly and that ABX news is certainly positive for the juniors in general.
Gold priced in dollars but not in USDX (as above), still has not reached the uptrend support drawn off the December 2016 low…
http://schrts.co/VQPFTe
The massive run-up, from 1999-2001 and again from 2008, makes the December 2015 low (tested successfully a year later) a very powerful C point. The chart is incomplete without this information.
I like the look of the miners as well. I re-established a partial position yesterday. JNUG. Tempted to put more in…
GH — There may be a drop to 1285-90 … The key is the dollar, and per the chart above as related to Gold alone, the Dollar-Gold inversion appears to be weakening.
I think we could drift down for a few months, I don’t think it will be dramatic, but the thing is you need to accumulate and not try and pick the absolute bottom. A war could spark off anytime in the ME, at which point you won’t get physical without a huge premium. I’m thinking of raising my gold holding to 20% of net assets, I think risk/reward would favour that
Here’s Rick’s opinion: http://news.goldseek.com/RickAckerman/1525953660.php
Great post by Rick A, thanks Silverdollar.
I like what I’ve seen of Kimble’s work but don’t share the same concern about the 18 month trendline break. In fact, such action is good for shaking up and shaking out those with tunnel vision who attempt to keep things a little too simple. Notice that Kimble’s red support line would have been steeper until late last year when that support broke. that break was followed by a higher high and this one will be as well.
There is some good nearby support and the important December low is still a comfortable distance below that.
http://schrts.co/M1282Y