Gold and GBPUSD + EURUSD

Due to the moves seen yesterday and today in currencies and Gold plus other futures i have inserted this post before the end of what should have been a quiet period before the new year and before my hot ideas about 2012.
Gold has reached what i believe is critical support and its current centre line objective ( the pink Schiff fork below). I am looking for a short term bounce to $1550-60... then depending on the signals/fork behaviour i will look to sell into the top of the rally if it fails. There is a potential bullish signal that appeared today which is that price should touch the CL of both Schiff forks
( drawn form the top left high (2) and top right higher high ( not numbered). See small charts.
Price is still short of the lower of these two centre lines and must return to 1520 to puncture it or reverse. We will in my opinion have still to test 1500$ and major support lies at 1475 ( see Esignal chart) where we will find out if gold will hold or will go lower but it maybe we are in a bearish phase that may last many months possiibly longer. EurUsd review to come

PS:My feeling is that Sterling and GBPUSD is the most potentially fragile currency (pair) for 2012 and we could see GBP hit against the majors. I have a long term short position ( taken early this week) which i will hold for the coming months ahead ( see lower chart below). But the 5 min charts shows an extremely high probability setup using the Schiff fork( blue) CL failure. If you do not understand my choice of pivots/forks please read this LINK

Happy Christmas (holidays) to all

A review of 2011 and my 'take' / forecast on 2012 to come over the weekend. Wishing everyone who reads this site a very happy and festive time over the coming days!

Gold :Nice rally - it's a shame its over!

Gold has touched the underside of the LMLP of the black fork ( pivot value AB-D72.4) see below in small chart- which is also the .382 Fib RT of the recent move down. A very slight penetration of the line and with MACD and 2 X and B-line + short stochastic divergence in multiple time frames suggesting ( shouting) that this market is overbought. This, to me, is a classic bull trap entry. Sucked in on the back of this weeks recovery I guess many folks have thought that Gold looks cheap at 1640... I cant think of a worse place for a long entry. The most obvious centre line objective lies at 1660$ and we are still well short of it. A break over the recent high would still not excite me that much and only a break upto 1675 would make me question my bearish sentiment and outlook.


P0 is the high on 17 October or the prior high on the 13th...it makes a tiny difference for the ML's but obviously the reaction lines are different for both pivots but they are not in action at the moment. The pivot fork value is higher for the 17th.This LMLP is green in the above MT charts.

Gold, Copper and EURUSD.. The Christmas week ahead.

Following on from my possible 'Three peaks and a domed house' pattern ID in copper last week LINK and see chart below:


I have some more orthadox reaction line work on these current charts below

HG Copper ( Comex) 240 min log scale:

HG Copper 240 min arith scale:


Copper 60 min -One chart( right hand side) is Log scale the other arithmetic. The true location of the reaction lines is only revealed using/combining the reaction lines form both scales and i usually then view in arithmetic.

So we take a 15 min chart below & the combined locations are shown the supporting and resisting reaction lines form forks with a pivot value of over 75. This doesnt mean there are not many other reaction lines exerting influence over price but these here have the highest probability of a reversal such as seen here on Monday 19 Dec 4 PM Euro time. It maybe that price will pop up higher over 332.00 or even upto 335.00 where i will look for a short position should the setup arise. What is clear is that price is being chanelled into a narrowing band of RL's ie a pennant (bearish). The outlook remains bearish



It's too early to say what direction price will takewhen it breaks out but i favour the downside but the break out might not occur for another week ie after Xmas/New year.

EURUSD: AS with copper we are moving sideways but need a momentous push to get through the downsloping reaction lines seen here...however I note we are no longer making lower lows and are holding levels on/around the long term (very thick dark blue) ML. I have no trades open and none planned but if i did I might consider a long upto a restest of 1.3100 rather than a short- although i still favout the downside medium term and the outlook from my perspective remains very bearish.



GOLD:
A break above 1609 would be bullish ( short term) but with all three markets covered here moving in close correlation any move will be reflected in the other 2 markets. I will wait to see if any movement results in a new trend over the first 3 days of this week but again think that we may have to wait until 2012 for clarity but overall the outlook remains bearish.

North Africa 1942 (+ Crete).Fallschirmjager’s photos

Here's the background to these photos LINK
Is this Rommel or Major General Bernhard Ramcke or Maj Burkhardt (addressing troops) in the bottom left hand photo of the 1st set below?

EURUSD

Price is weak and stuck and only a convincing break above 1.3047 will change this and change my opinion that in the near term we are going lower + today is Friday so you never know what tricks and trends will develop. On the plus side for the euro we have support at 1.2974 in my 4 hr Ensign chart. The thick dark blue centre line comes from the important fork ( Pivot value 93.6)
P0 June 1991 1.0614
P1 March 1995 1.4535
P2 Oct 2000 .8225

Gold fails at 1600

Gold has failed to break back to/and above 1600$...there a very high probaility it now goes back to 1565$
UPDATE: Friday 16th Dec: Gold still seems unable to penetrade above 1600$
http://seekingalpha.com/article/313989-gold-decline-may-be-foreshadowing-a-market-crisis

Copper (comex HG) A study: 3 peaks and a Domed house?

The book by Ed Carlson titled " George Lindsey and the art of Technical analysis" has been one of 'the' technical analysis books of the year and i suspect has sold very well. Fascinating to read and George Lindsey is (was) somewhat scary in appearance after facial surgery and hair toupees and a complex personal life ( reminding me of a perculiar uncle I had !) but as they say ...there is a thin line between genius and insanity, not for one moment that i am suggesting he was a few straws short of a bale but he was...er... unorthadox ( lets leave it at that). I read it this summer and got my head round some great ideas including his theory on time intervals, counts and its application to history which has some profound and startling results yet in many ways once grasped made total common sense. The 'Three Peaks and a Domed House' chart pattern is complex and however when i put it down i thought to myself....'Well that's one chart pattern I will never see as you would not have a bats chance in hell of spotting it' and so I put it to the back of my mind. Not only is this pattern long and complicated with several patterns within a pattern but there are more than one schematic versions of it knocking around on the web and that's without including the one in Ed Carlson's book on Lindsey.

These two diagrams may look the same to you but there are crucial differences to me but this allowed me a certain flexibility.
Fast forward a few months to this morning when i spent an hour or two looking at Comex Copper (HG) on the Esignal charting platform. I had a completely clean chart with no forks/reaction lines/pivot counts/Fib levels or indeed any indicators. Copper is a market I follow closely( daily) and is an industrial metal extrememly sensitive to economic fundamentals. Here is my 3P&DH wave count on the weekly Copper chart (candlestick & line).
I often thought that Lindsey missed out by not calling it the " Three Peaks and a Doomed House" because price is 'doomed' once it tips off the 2nd RH shoulder!!


Enough bad jokes from me as this still leaves me with a need to find a view on the future of Copper. It matters not if the above Copper charts are displaying the classic 3P&DH components. There are definitely 3 peaks. Then the basement then the first floor and then a head ( double head) and shoulders or Cupola. However pivot # 4 and also pivots #10-14 worry me a bit, but the 15-20 AKA "the first floor" works well as does the rest of the pattern. Infact if you look carefully you will see other possible smaller 3P&DH patterns within this larger pattern shown here on the weekly chart.
So What! I hear you say and i agree. The important issue is where we are going now. According to Carlsons book on Lindsey i quote:
"An abrupt decline then follows that right shoulder( of the top H&S). This larger decline from the right shoulder(25) of the cupola precedes another short recovery(26-27). The top of this second recovery often ends at a level, relative to the 'First Story' roof".....
he then continues
"After this second lower right shoulder is completed the average drops back to the ultimate low of the base where the domed house began"
Well, I can't see HG Copper falling back to 125.00 but I can envisage taking out the 'First Floor' or the 15-20 set of pivots which have support at 275.00 and remember what makes this such a powerful pattern is that " The knowledge that the entire gain of the previous 2+ years will be wiped out"



Now back to more familiar territory for me.....The structure offered on my chart by long term reaction and median lines. The chart below was accurate enough to define the top of the market this summer ahead of time and was posted as such by me at the time,

And what do the indicators on the daily show? Long term stoch (2x) and B#Line long term are tipping down but for the sort of move we are talking about there is no 'waterfall'/ ' water over the edge' sign...yet!

I suspect 2012 is going to be a horror! with sovereign defaults, stagnant growth/ recession,and mayhem in credit markets and banks going bust as the Euro zone unravels politically and monetarily but wow! Copper back at 125? Perhaps I am not that confident, More likely A .618fib RT of the 2009-2011 move up would see us at 250.00 but one thing is for sure for the moment. There is a very high probability of a restest of 300 and then a break below. Thats nearly 30 cents below todays price and if Gold plays out as i anticipate with at least a few more hundred bucks on the downside then it may just be possible to see a sell off in Copper the likes we have never seen before. Until that day comes i am looking for a short position in HG Copper with a test of 300.00 as the partial objective. Stops will be above 333.00 but I will post any entry and method.

Gold..... a study in price weakness continued + the 'topping out' pattern...It's a beautiful thing!!

This is a spectacular fall. Gold has reached the second black mod Schiff centre line. The lower of the two price objectives (blue in metatrader below) at 1566.00
I cant think of any reason to buy Gold even here at 1565 a few hundred bucks below where we were a few days ago/last week however if I had to chose a point for a bounce it would be here BUT remember this pattern is not over yet and has further to go on the downside.
LINK1,
LINK2
LINK3