-- Posted Tuesday, 24 July 2012 | | Disqus

By Gary Tanashian

I see analysis popping up out there refuting the bearish Descending Triangle view and in my opinion that is with good reason; it looks a lot more like a massive consolidation of previous bullishness than a topping pattern.

However, a common theme seems to be some kind of static about a QE3 'Super Sunday' (don't hold your breath) or some such noise and gold's imminent and preordained blast off, never to return to current levels as the 'banksters' take it higher and higher.  

A theme seems to be that now is the time to be bullish but I have also read within the same theme that we cannot be sure that the 'banksters' will not crash gold through support first, to totally eliminate the little guy before bringing it higher. 

This blog noted that possibility last week.  As in my 'guess' (and that's all any of these guys are doing) was that gold would break down, potentially to the high 1400's, where it may end its correction on a final shake out.

I will tell you what should be eliminated however, and it is not so much the little guy as it is the grand and titillating predictions.  There is stuff out there that has been strongly supportive of gold and gold stocks all the way down, while always containing a rejoinder like 'of course it can go lower so the gold community can get 99% eliminated before the 'banksters' (or whatever the nickname du jour is) ramp it higher'. 

A problem being that this dynamic sounding analysis has kept 'em in it every step of the way down - and managed to cover its own a$$ at the same time by always slipping in a caveat.  The suggestion here is to keep an open mind, realize that not you, me or the writers of dynamic and titillating things know what is going to happen.

What I do know is that the chart above is very orderly.  The weekly MACD and the altered and slower MACD I am experimenting with (in place of the TRIX for now) have given no bull signal but have given a view of the elimination of damaging momentum.  RSI is above important support and beneath resistance that would signal the end of the correction if exceeded.  The weekly trend is down (as is daily, with monthly trend up) and the more sensitive CCI is above -100, which is a positive signal.

That is all there is.  A metal that has been historically tied to sound money systems is in a corrective consolidation.  This will be the case until the price rises above the two noted moving averages and then breaks the blue trend line, and goes RSI 50+ or breaks down badly and disqualifies what I have written above.

The advice here continues to be to tune out the 'us against them' stuff about the evil banksters, cabals and other nefarious big monied boogey men (the biggest boogey man is a big brained and mild mannered fellow at the Federal Reserve running an operation in T bonds - I know, that is my own tin foil hat talking) and have patience with the process.  Part of that patience includes risk management - especially as pertains to any kind of equities - because risk management enables patience.

Meanwhile, speaking of patience, the gold chart above is the picture of patience.  That is all it is.

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-- Posted Tuesday, 24 July 2012 | Digg This Article | Source: GoldSeek.com

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