6-18-2009
As regular viewers of our videos know, we are constantly adding new video products. Guests on our videos now include:
- Jake Bernstein of Jake Bernstein's Weekly Market Letter on market trends
- Mark Leibovit of VR Trader.com on market timing
- Gordon Linn's insights on trading
- And of course me, Ira Epstein
http://iraepstein.linngroup.com/videos.html?rand=0.021
Seasonal Story
The chart below was supplied by The Moore Research Institute .
The Seasonal Gold Chart above displays gold price movement in two ways. It goes back 15-years to get a more current average of prices and back 35-years showing a longer averaged time frame. Historically speaking, prices trends are fairly erratic in summer months. It's at summer's end that uptrends often grab hold.
Keep in mind that the above chart is simply a road map of what prices have done going back over a 35-year period. Divergence can occur, but isn't likely too last too long given market tendencies.
That having been said, gold's tendency is to get strong at the end, not the beginning of summer. This probably has a lot to do with jewelry demand and vacations. Yes, traders take vacations and when they do, markets slow down a bit. Given the summer in the USA and Europe is vacation time, this fits in.
News of the Day
No matter what you think, the fact is that gold has not rallied as a "Safe Haven Hedge" off the Iranian and North Kosraean news. Normally the kind of street demonstrations seen in Iran and the threat to the region from this would add a strong prop to gold prices. As we go into day 5 of street demonstrations, arrests and crack down on news journalist in Iran, has to have left the bulls. When bull news and events don't move the day, bearish events have a stronger influence.
Daily Chart
Those who are regular readers of this report and my Twice Daily Updates know that nearly two weeks ago I had shifted to becoming short-term bearish. I still am and believe more of a price break is in the cards. I am not longer-term bearish at this time because the longer term charts will remain in the bull camp until and unless $865 is taken out.
For shorter-term you should focus on The Daily Bar Chart as displayed below.
The first thing I notice is that Stochastic Study, the graph on the bottom of the above Daily Chart of August Gold is in the first stages of embedding. This means the market is oversold now, but within 2-days it can embed which if it does implies that even lower prices should be forthcoming. If I am right, prices could easily drop down to the bottom band, the "white band' which is called the Bollinger Band Bottom. That is near 922.4. If Stochastics embed I expect to see continued selling on rallies until the chart pattern changes.
I remain bearish as long as 964.5 is not taken out. If today's low of 930.5 is broken the stop on being short can be moved down to 944.1.
The key is to be sure Stochastics embed. I will notify through my Twice Daily Reports via e-mail if they do.
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