October 19 2014
Gold Medium Term
Long Term Trend ~ Bearish since Oct 2013 @ 1361
Long term Moving averages 1508 – 1553
Medium Term Trend ~Neutral– The red moving average is above the blue so any close below 1180 now will favor a bearish trend. Odds favor 1290-1302 will be strong resistance and this area could be tested either in October or November.
Medium Term Moving averages 1289.21–1294.52
Gold held the 1180 bear market lows for the third time In the 15 months. Odds are not high for triple bottoms holding and thus we still have to figure there is one final wave down that is not complete. If we had made a new low it would have been possible to label the drop this year as a final wave 5 and our expectation for gold’s final bear market leg would be in place. Because we did not, the best fit is we are still in wave 4. That leaves a lot of options open for where gold is going over the next three months. On a maximum level, it is still possible for gold to move back to the 2014 highs near 1380 and still be in this wave 4. On a minimum level the 1240-1272 area is the first target. Interestingly, both silver and the gold stocks are now likely in their fifth and final wave.
Going to the chart below, gold penetrated the down trending gold line two weeks ago, but by the end of that week was back above it. Odds favor we’re heading for a test of the GREEN channel lines.