Greetings Jim,
Today’s breakout was a significant technical development that forecasts substantial gains. Gold closed sharply higher today, moving well above the previous all-time high near $1,256 on the daily chart and reconfirming the long-term uptrend.
|
|
We have been monitoring the development of a bullish consolidation formation in gold and the Gold Currency Index (GCI) since early August, so this long-term breakout has been anticipated. Today’s strong move higher has also signaled the likely development of the latest Short-Term Cycle Low (STCL) yesterday, further supporting the continuation of this rally.
|
|
The next technical objective for this developing breakout would be a strong weekly close. The previous weekly high was also at the $1,256 level, so a Friday close at current levels or higher would result in a long-term breakout on the weekly chart as well.
|
|
We are currently only 7 weeks into the intermediate-term cycle following the low in late July, so time would also be supportive of this breakout on the weekly chart.
|
|
Technical analysis and cycle analysis both indicate that price and time are now closely aligned across multiple time frames, suggesting that we may be witnessing the start of a powerful move higher. In general, a long-term breakout such as this one is confirmed once price action closes at least 2.5% above the previous high, so a move above $1,288 would be a major bullish signal that would forecast substantial gains over the next several months.
Best,
CIGA Erik
Prometheus Market Insight
http://www.prometheusmi.com
Dear Eric,
The First World is now Asia.
Volcker won it all for the West while Greenspan and Bernanke gave it all to Asia.
Shame!
Regards,
Jim
Third world America
CIGA Eric
Tough choices continue to be made as local budgets are slashed from decreasing tax revenues. I would add that third world countries do not have the luxury to print currency to fund their stimulus and injection programs, so the headline is a bit too "shock and awe" for me. The stark reality of contracting government services on a society increasing dependent on them can give the impression of a transition into a ‘third world’ from a country used to a high standard of living.
Even with interest rates at unprecedented lows, there is anxiety about the possibility of a double-dip recession. Sales of existing homes are at their lowest level in 15 years, and new home sales plummeted this summer to the lowest levels on record. Property and sales tax revenues have shrunk. And nowhere is this more apparent than at the local government level, where officials are being forced to roll back the everyday hallmarks of modern civilization.
Source: www2.macleans.ca
