Tuesday, May 3, 2011

Gold Harmonics

Although it is stretching things, the three peaks and a domed house scenario is still a possibility--especially considering the market action and the time price harmonics coming into play in this time frame.

  • 50% of the low to low cycle of Jul 28 2010-Jan 28 2011 (184 cd) was April 30th.
  • The price amplitude of the Jul 28-Dec 7 bull wave was $274.70 . 1/2 of 274.7 added to the 1430.60 Dec 7th high is $1567.95
  • The $122.50 decline from Dec 7th to the Jan 28th low at $1308.10 when added to the Dec 7th high equals $1553.10
Therefore there is a 2:1 ratio evident in the market structure--both in terms of price and time.


The chart below shows the potential 'Three peaks and domed house' formation which if continues to form has VERY BEARISH implications for the gold market.
Silver is clearly parabolic and VERY overbought--coincident with a test of the 1980 highs. Certainly a time to exercise EXTREME caution.


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