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-- Posted Tuesday, 22 May 2007 | Digg This Article | Source: GoldSeek.com

Rick’s Picks

Tuesday, May 22, 2007

“Phenomenally accurate forecasts” 

Gold has chastised and disappointed bulls so many times since last May that we want to be quite certain of our indicators before sounding the all-clear. Unfortunately, the coldly mechanical Hidden Pivot method that we use to forecast price trends has mostly glum things to say about bullion at the moment. Yes, that could change in as little as a day or two if certain things were to occur even on the lesser charts. But as of yet there have been no such signs to warrant even cautious optimism, let alone an outpouring of bullish predictions.  The chart below, of Comex June Gold shows why.

Notice how yesterday’s rally from point ‘A’ failed to surpass any of the visually distinctive peaks that had occurred over the previous week. In our experience, important rallies almost invariably begin with a thrust that surpasses two or more prior peaks on the intraday charts. Moreover, if those peaks were etched on the way down, the impulsive thrust that has surpassed them is properly regarded as having been even more impressive. Peaks #2-#5 in the chart above illustrate these “external” peaks, while #1 is a less-imposing “internal” peak. Definitions aside, yesterday’s tentative stab did not exceed much of anything, and we take that to imply that gold bugs shouldn’t get their hopes too high, at least not right now.

Please note, however, that it would take a mere $10 rally to blow past no fewer than four of those peaks -- twice the minimum “priors” we require to turn us bullish for the near- to intermediate-term. An impulse leg that impales four previous peaks without, so to speak, drawing a breath, would imply that a far more powerful eruption is percolating below the service. We’d be bullish as all get-out were such an event to have occurred by today’s closing bell. But until such time as this occurs, we must hold our bullish effusions in reserve.

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Information and commentary contained herein comes from sources believed to be reliable, but this cannot be guaranteed. Past performance should not be construed as an indicator of future results, so let the buyer beware. Rick's Picks does not provide investment advice to individuals, nor act as an investment advisor, nor individually advocate the purchase or sale of any security or investment. From time to time, its editor may hold positions in issues referred to in this service, and he may alter or augment them at any time. Investments recommended herein should be made only after consulting with your investment advisor, and only after reviewing the prospectus or financial statements of the company. Rick's Picks reserves the right to use e-mail endorsements and/or profit claims from its subscribers for marketing purposes. All names will be kept anonymous and only subscribers’ initials will be used unless express written permission has been granted to the contrary. All Contents © 2006, Rick Ackerman. All Rights Reserved. www.rickackerman.com 

-- Posted Tuesday, 22 May 2007 | Digg This Article | Source: GoldSeek.com

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