Saturday, June 7, 2014

Gold update: IHS about to fail?

Gold after forming a triangle in April and May broke down.Now is moving towards 1265$ although with low volume. In order for the bulls to remain valid the IHS scenario they need to see higher volumes. The April May triangle is probably a continuation pattern and it gives a target for gold at 1200$ where it should bounce.
So a possible pathway for gold:

 Probably gold is now forming a falling wedge and should bottom in mid July(cycle low) at ~1200$
If this scenario plays out then Gold is in a long term trading zone between 1200 and 1400$

Gold Miners (GDX) are following a similar pattern. GDX is moving (with declining volume) towards 23 ( gap from 27/5) and then move towards 20,5 in early July (it will bottom earlier than gold just like December 2013).