gold

Gold moving down into possible 20 week trough?

As Good as Gold

Gold looks good here for a trough of possible 20 week magnitude due in a week or slightly more. The nest of lows is due at the start of March, according to the phasing below. This is the most recent phasing I have –  with an 18 month trough in November of last year:

XAUUSD_£__daily_19_02_2015The first 80 day cycle out of this large trough was fairly quick, coming in at 56 days and bottoming on the 2nd of January this year. This is to be expected after a trough of significant size. The move out of the 80 day was strong and banked a good profit, entry was on a cross of the 20 day FLD to the upside. Now price has retraced much of that incline, reflecting the long term possible bearish nature of this instrument. I think we are in the midst of a ‘G’ category interaction so another 20 day cycle to go until the 20 week trough might occur. There have been 48 days so far in this current 80 day cycle so be alert for a possible early trough in line with the first 56 day (80 day nominal) cycle. The 20 day is currently running at 16.5 days and I think we are around 8 days along its path.

Projections

XAUUSD_£__daily_19_02_20152The FLD boxes on Sentient Trader provide a rough estimation of possible trough and projection points, based on multiple FLD calculations.

There is a chance price could breach the 18 month cycle low but I doubt it. If it does be prepared for downside to come more quickly.

As far as the 20 week projection goes if price holds the 18 month low I think it will reach up to the 18 month FLD (yellow line) again and perhaps form a top. It has provided resistance at this current 20 week cycle, which is tracing out a neutral  to bearish cycle shape so far.

Long entry will be on a cross of the 10 day or 20 day FLD or possibly a valid trend line, depending on the setup. I will post again when the trough is nearer to detail this possible long trade.

You may wish to keep an eye on Silver which is also tracing out a similar path.

 

2 comments

  • Yes, im trading the same setup, Ive already started to scale in long after the 20 day VTL break. This looks like a good setup to the 40 week projection!

    • Hey Derek. Yes hopefully ride this one to at least the previous high and assess from there. Just got back from a short holiday so will add a new post today or next week on the current status.

Leave a Reply

Your email address will not be published.