Gold – 24 Oct

Gold closed up today for the second day running and price actually closed above the 18 day moving average, a good sign. As usual price closed off the highs which were capped by the 100 day moving average (gold). The Bollinger bands contracted further and the tighter they get the more likely we are going to see a break. Flip a coin, risk on, risk off. Who knows how it will go. I am only charting because the skill will one day come in handy again, just not until after this fraudulent US dollar reserve monetary system blows sky high. I do not think the 18 day has been cleared in any significant way so resistance will be the whole area here comprised of the 18 and 100 day moving averages around 1650. Support is the 1604 area of the last swing low.  The current short term trend is still down with a pattern of lower highs and lower lows. the swing high at 1670 must be taken out to neutralize the trend. stochastic tends to be a leading indicator and is putting in a bullish cross of the slow line by the faster one. Divergence looks possible here with horizontal price trend in disagreement with trend lines in RSI, MACD, and stochastic. I would still characterize this chart as one looking for direction. A close above 1680 would be constructive to the idea that consolidation is over.

Buy the dips people! We are talking about crumbs here, gold was 1920 just weeks ago. It is a screaming value at 1650. Ditch the paper and buy physical. Freegold valuations will render these charts inconsequential.

Wide view:

The weekly chart is just starting to show some contraction in the Bollinger bands, indicating volatility is dropping. If I were to guess I would say that the bands are likely going to continue to compress to a more normal width seen earlier throughout the 3 plus year trend. It appears that the trend channel will top out around 1800 at the end of the year. The holiday season is favorable for gold and I think we are going to see a move to that level or higher commence in the next couple of weeks.

 

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