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Replies to post #40521 on GOLDBUGS AMEX Goldbugs Index (GOLD)
03/14/21 11:05 AM
The NY Gold Nearest Futures closing today at 171980 is immediately trading down about 9.25% for the year from last year's settlement of 189510. Immediately, this market has been declining for 2 months. This price action here in March is warning that we may have at least a temporary high in place beginning perhaps a bearish reactionary move on the monthly level if we see lower prices next month or close lower. Otherwise, there remains the potential for a one-month Knee-Jerk reaction low. As we stand right now, this market has made a new low breaking under the previous month's low dropping to 167330 intraday yet it is trading at least below last month's close of 172880.
Up to now, we still have only a 1 month reaction decline from the high established during January. We must exceed the 3 month mark in order to imply a trend is developing.
ECONOMIC CONFIDENCE MODEL CORRELATION
Here in NY Gold Nearest Futures, we do find that this particular market has correlated with our Economic Confidence Model in the past. The Last turning point on the ECM cycle low to line up with this market was 2015. The Last turning point on the ECM cycle high to line up with this market was 2020 and 2011 and 1996.
MARKET OVERVIEW
NEAR-TERM OUTLOOK
The historical perspective in the NY Gold Nearest Futures included a rally from 2015 moving into a major high for 2020, the market has pulled back for the current year. The last Yearly Reversal to be elected was a Bullish at the close of 2020. However, the market has been unable to exceed that level intraday since then. This overall rally has been 5 years in the making.
This market remains in a positive position on the weekly to yearly levels of our indicating models.
From a perspective using the indicating ranges on the Daily level in the NY Gold Nearest Futures, this market remains neutral with resistance standing at 178460 and support forming below at 171870. The market is trading closer to the support level at this time. An opening above this level in the next session will imply a decline is unfolding.
On the weekly level, the last important high was established the week of January 4th at 196250, which was up 5 weeks from the low made back during the week of November 30th. We have seen the market drop sharply for the past week penetrating the previous week's low and yet it recovered to close above the previous week's close of 169850. We are trading below the Weekly Momentum Indicators warning that the decline is very significant and we need to pay attention to the timing and reversals.
INTERMEDIATE-TERM OUTLOOK
YEARLY MOMENTUM MODEL INDICATOR
Our Momentum Models are rising at this time with the previous low made 2018 while the last high formed on 2020. However, this market has rallied in price with the last cyclical high formed on 2020 warning that this market remains strong at this time on a correlation perspective as it has moved higher with the Momentum Model.
Interestingly, the Nasdaq 100 E-mini has been in a bullish phase for the past 11 months since the low established back in March 2020.
Some caution is necessary since the last high 196250 was important given we did obtain two sell signals from that event established during January. That high was still lower than the previous high established at 207800 back during August 2020. Of course, that was the major high in this market, which means we have a downtrend for the past 6 months. Distinctly, we have not elected any Monthly sell signal to date from the turning point of 08/01 on this monthly time level from that major high so there is still important underlying support which needs to be broken to change the trend on this time horizon. Critical support still underlies this market at 144610 and a break of that level on a monthly closing basis would warn of a further decline ahead becomes possible. Nevertheless, at this time, the market is still weak trading beneath last month's low.
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