Note the weekly view on the XAU index (the gold bugs, HUI index is very similar, if not slightly better). Since August of last year, the gold index has been bumping up against the resistance line we drew on the chart above. Technicals have been improving dramatically on this last run up to resistance and we believe that the index is on the verge of a huge breakout here. A break above this line should give gold shares a huge lift and cause stocks in the sector to complete the second leg of the measured move pattern.
In plain English, it is reasonable to expect a move equal in length and time to the run in gold which took place in the years 2005 and 2006.
4 comments:
today the market should close above the yesterday's level. regard.
Yes, the bears are on the ropes here. Too many have been caught leaning too hard one way.
yes,daytrading with dow is not easy. i must give up the gain of the last 2.5 days in order to be stopped out this time. regard.
That's absolutely right. All a trader can ever do is measure the probabilities and take a position on the side where probabilities are highest. Statistically some of these trades are going to be wrong, thus the need for stops.
Success is measured over time, not from trade to trade.
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