Tuesday, May 27, 2014
whoops! gold just pooped a lung
Gold dropping below $1280 isn't good. Here's the daily candles to splain why:
It has printed a wick before down to $1268 or so. So we're not exactly in no-man's land yet.
However, we haven't see a daily close below $1280 for the past few months of chop; that and the proximity of the SMAs used to make this chart look hopeful, as if an upmove was a possible threat.
A daily sub-$1280 close opens up a new lower price range for gold, one which indicates a failure to finally conclusively break above the SMA(50) and SMA(200). That will probably inspire Wall Street Whitey to start selling again.
Moving down into a lower range also makes the weekly chart look bad, again because gold was threatening to overtake its weekly SMA(50). That was what was making the weekly gold chart look hopeful; on a gold downmove, it will look less so.
Especially if gold makes it down near $1200; all you'd need then is for someone to walk into a crowded room and say "there's no such thing as a triple bottom".
What's funny is that this morning I was laughing at how Mineweb ran yet another article from Julian Phillips, calling for (yet again) another "imminent strong move in gold". Hey, it's true - if a price range gets tight, one day it's going to widen.
So congratulations, Julian Phillips - after months of predicting that gold's price will move, it looks like it's finally going to move. If only your predictions were even remotely actionable! Wow, it'd be worth it to read your articles then!