Technical observations of RossClark@shaw.ca
The sixteen month consolidation of the US$ gold price continues. Based upon the history of August being a pivotal month coupled with the consolidation having a similar price pattern with 1994, 2002 and 2007 we believe that a close above $960 would be expected to trigger a move to the all-time highs.
Another fractal pattern of interest is the comparison of the multiple attempts of gold to breakout through $1,000 and the sixteen year consolidation that the Dow Industrials made before clearing 1,000. Don't under-estimate the potential on the upside.
If prices make new highs it is imperative that subsequent pullbacks merely test the breakout.
The short term swings of this year are closely in sync with the average seasonal pattern of the past four decades. Based upon it we should look for the current decline from $960 to base out within ten days.
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