MMM Weekend Update 5-26-13

Gold - Is currently navigating the previously mentioned support zone of 1310 to 1430. The initial dead cat bounce up to 1488 has now settled back down along with some of the volatility. While the price remains below 1440 to 1488, I suspect the trend will continue to move sideways and down. Above that zone allows a possible run up to 1520 to 1600.

In previous blog postings I have laid out the case for 1230 to 1280 being the next level of significant support and 850 to 1050 likely being bedrock generational support. However, a few other measurements seem to be pointing to the 1150ish level as possible support as well.





If the price actually falls to this level, I'll be on the look out for possible reversal patterns using Elliot Waves, Candlesticks and the QG3.

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Silver - Unlike Gold, Silver has yet to back test even a small portion of it's break-down. As positive divergences develop in the Oscillators (RSI(14), MACD), I suspect that this back test of the 26.00 level may be realized, possibly inside the next few months. But I highly doubt the first back-test will breach 26.00, a back-up for another run at it later (several months perhaps) is more likely to breach it. A contracting ending diagonal pattern (orange) would be very helpful in gauging a potential major bottom.



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HUI (miner index) - is starting to touch the top of some major LT support. Any further down and stock prices will reach into 'ridiculous' territory. Several senior dividend paying mining stocks now have P/Es in the teens and even single digits. I don't suspect this condition to last for very long.



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USD/CHF - Produced a text book 'Triangle/Thrust' topping formation leading a downward move into what is likely to be a larger ST consolidation.




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USD/JPY - Produced a text book Ending Diagonal pattern (expanding type - distributed top)




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AUD/USD - Elliot Wave and Candlesticks can be useful for identifying ST tops and bottoms, But the QG3 is designed to catch and land the 'big fish'. Our current Short position in the Aussie is likely to net a 'lunker' of several hundred ticks.



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Quad G

MMM Weekend Update 5-12-13

Gold - Is in the process of back-testing the previous break-down out of a base channel. A successful test would see a rejection soon and at least one more leg down (red projection). However, if instead the price moves above the 'neutral zone', back into the channel again, the MT outcome could be very bullish.




Last week closed with what is typically a bullish hammer candle on Friday, but it's important to understand the 'flip side' of such candles. Playing candles is playing probabilities, there is a bullish and bearish one in each hammer candle:



Here is an example of a bullish hammer candle that failed:



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USD - Has been consolidating the last 4-5 weeks, a thrust to the upside could challenge a long term trend line above for the 4th time. As you know I'm a fan of the 'Rule of 4' (Ro4) which has a high probability of producing impulsive behavior when triggered.



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AUD/USD - Has produced a great example of a Ro4 that was triggered to the downside:





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Trade School - As part of my QG3 market signal service, I identify chart patterns that offer a high probability of providing a successful trading outcome. Recently I outlined a successful Ending Diagonal pattern in GBP/USD and a key bearish Hammer Candle as part of an ABC fibo price relationship in EUR/USD.

GBP/USD - Ending Diagonal


Outcome:



EUR/USD - Bearish Inverted Hammer on the Daily and ABC Fibo relationship:



Outcome:



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Good Hunting out there,
Quad G

MMM Weekend Update 5-5-13

Gold - The mid-channel is often a 'fork' in the road that can determine the attitude of subsequent wave structures.
The LT 4 point channel (blue) can be a base channel followed by a break-down into an acceleration channel, if so the price action should stay below the mid-channel line (dashed blue). However, a breach above that line (green projection) on a weekly closing basis would suggest that the 4 point channel could be a bull flag eventually leading to further upside upon a break-out above the channel.



My long term perspective looked like this back in 2011:



http://majormarketmovements.blogspot.com/2011/07/gold-lt-end-game-final-5th-is-near.html

My target was not reached, the top came sooner and shorter than expected. Where to now? There are a few counts that I can fathom, some very bullish, some very bearish, all with their own unique requirements. However, the generational support for any EW count is very likely between 850-1045ish. I will not predict that the price will indeed move into that support anytime soon, but if it did, I do think it would be a dream come true for many stackers.



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EUR/USD - Is possibly setting up a bearish HnS pattern, but must stay below 1.3711.



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Crude (WTI) - An interesting Triangle with in a Triangle pattern. We could see a 'Rule of 4' breach to the upside without a serious rejection.



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