Gold update

The weekly Gold chart shows we are in wave C down as anticipated while the uptrend from the 750 levels will be tested and broken with a high probability. Even the Chinese and Indian are getting smarter and do not intend to buy at the highs. The long side is still overcrowded with Hedge Funds massively long and a wide spectrum of smart housewives with them. Basically nothing wrong with the basic assumption since central banks keep printing worthless paper but as we are laerning on a daily basis market prices have nothing to do with fair evaluations and any given time it is rather a matter of average over a longer period which determines value. For now we can expect more longs to be shaken out of the tree as the target of wave C should be around 1400 since also the next weeks the Dollar strength should continue undermining commodity prices in general. Time-frame is another 4-5 weeks for the wave C to end and the 1400 to be tested. Thereafter we can expect a blow towards the 2000  (rather 2100-200) level and take it out even for a brief time which should rather mark a long term top I suspect. I do not see the 3000-5000 scenarios at least not in regular markets we can trade in – if Gold is ever to go that high it will be in a totally different world with no real order at all and you might be more worried about surviving than making bets on markets.


~ by behindthematrix on December 26, 2011.

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