Danny, technically Arhidas is correct. What we have is a large pennant formation which is really a consolidation pattern on top of the rise in POG that began back in April 2001. Text books tell us that the probability with such patterns is that they are more likely to break in the direction of the original trend. Thay also tell us that the longer these patterns continue, the less predictive they become. Currently the breakout level is around 366.50 but this is declining with time.
That said, I'm not really sure what we can say with any confidence from that pennant. Overnight gold eased but this is only to be expected as it has had a good run and some retracement was to be expected. The 50 day MA for POG is currently at 353.50 and gold has held comfortably above that level though I note it was hit hard in the thin trading of the NY access market.
Having trouble accessing my sources for what happened to the $US last night but would not be surprised if it stregthened given the action in POG.
