GOLDBUGS AMEX Goldbugs Index (GOLD)

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• The Gold Bounce
By: Marty Armstrong | December 7, 2018

Of course gold has been trading off of interest rates regardless of how stupid that may be since lower interest rates reflection deflation. Nonetheless, as we can see, technically, gold held the former uptrend channel last year when it fell to 1146 and so far 2018 has just been an inside trading event. Just from a technical perspective, gold must exceed the previous year's high of 1362.40 and close above that to be impressive. At the very minimum gold would need to close above 1309 to show some strength. It just may be too early just yet for any real solid move. That still requires a crack in the monetary system to get people on board. A closing below 1267 will still leave the market vulnerable, although we see a turning point and Directional Change due in January 2019. Caution would be advisable with a January reaction high. The first Monthly Bullish is at the 1330 level. We did elect one Weekly Bullish which has given us the immediate bounce. However, we clearly need a weekly closing above 1267 to see a text of that Monthly level.

Of course, the prospect of a crack of the $1,000 has not been negated as long as we remain below 1362 on a monthly closing basis. That would create a HUGE bear trap and that may be what is needed for a slingshot to the upside into the next ECM target.

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