View attachment 3624581Before that precipitous fall in 2013, trend was rangebound then the support gave way and on that weekly break, if you drill into the daily I recall a Friday morning in NY when thousands of paper contracts were sold into. My memory of the incident was still vivid but the details may be slightly vague after a decade.
Currently, I see all lower peaks and the support is in danger of being tested again. Predicting is futile and I will wait for market reaction and direction.
Both condition are exactly the same, contemplation of tapering. The difference is that QE (4) for this pandemic crash is bigger than the combine QE1-3 & Twist. If we work on the same logic as Bernanke/Yellen that eventually they need to raise IR because you can't just QE forever, this token IR raise is to probably to reload the chamber to fire for the next economic crisis.
View attachment 3624638What I am worried about is the local XGD, a H&S has already formed, depending on perspective the neckline has already broken (trendline) or about to be broken (horizontal). Unfortunately I do have some exposure in this sector from recent entries so it is critical that the technicals do not break.
Should spot gold breaks last month's slam and quick recovery low, this is what I fear is the repeat of 2013. Critical time, and the optimist will tell you that the current is a decade + formation of the C&H pattern, but that require the peak of $2075 to break and do a runner. The current momentum is no where near such technical anticipations.
So there you have it, my objective view regardless if I have exposure. I must admit I recently bottom pick this sector and it was always an odds against my punt thinking that if I am wrong, I get out with a small loss and maybe revisit at a later date.
In conclusion, gold has had a frustrating year. Good luck to us with exposure.
