Monday, January 7, 2013

Gold: Geometric Time-Price Harmonic

Both the USDX (see previous post) and Gold are at harmonic inflection points. It will be interesting how this situation resolves itself.

7 comments:

Anonymous said...

Your charts suggest Gold down and DXY up, for the next wave?

Fibocycle said...

The charts suggest to me that both the US$ and Gold are in a position where the next leg will likely gain the energy to begin an intermediate cycle trend--whether that is up or down remains to be seen. The technical chart for gold--which I have added suggests to me that Gold could move higher from here. The US$ technical chart seems ambiguous at best, but the geometrics are suggesting that the path of least resistance is UP as well. Both Gold and the US$ are hovering around their respective 200 day moving averages.
Is it possible for both the US$ and gold to advance in unison? That scenario would suggest a European crisis with Euros leaving for the safety of gold and the US$.
The week of Jan 12-18 could set the stage for the next major moves ( intermediate cycle).

One thing I am pretty sure of: This year is going to be difficult with choppy and increasingly volatile markets. There are several longer term cycles contending for dominance and this usually manifests itself as nervous and choppy markets with lots of 'surprises' both up and down.

The colours on the right side of the charts indicate the bullish/bearish parameters for the markets.

Chartrambler said...

excellent charts,thanks !

Anonymous said...

Thank you. I recall that earlier you favored DXY down to 78.40/80, with a neckline around 78.60 as support. Does your more recent work suggest that is far less likely than previously anticipated? Thank you in advance.

Fibocycle said...

The risk reward set up would have been far more attractive just below the 79.00 level--especially a climatic candlestick day--but it hasn't happened and the chances are declining every day, especially with the break to the upside in the US$.
I think it is quite possible that the US$ and gold could move higher in tandem--the rationalization for which on CNBC would be highly entertaining....almost Monty Pythonesque.

If a trader was stopped into a long position on the USDX on the break out it is now the top priority to monitor for a short term high--followed by a decline to form a pivot where the appropriate stop can be placed (other than the stop being based on portfolio risk % parameters.)
Same could happen with GOLD.....
BOTTOM LINE: Allow the chart to guide you into--or out of-- a position and then monitor the geometrics and the pivots to manage the position with regard to mitigation of risk.

Dolemite said...

"the rationalization for which on CNBC would be highly entertaining....almost Monty Pythonesque. "
HAHAHAHHA well said

Anonymous said...

If DXY (and GOLD) rally out 11-14 Jan, that may suggest significant weakness in SPX, and a bid in US bonds, from late Jan into Feb?