To 321gold home page

Home   Links   Editorials


Technical observations of

Bob Hoye
Institutional Advisors
Aug 3, 2009

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.

click to enlarge

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.

click to enlarge

The next rally is of above average importance. August has been a pivotal month for gold. The years in which gold managed to move through the July resistance during August there was a high reliability for the advance to continue. Recent examples are 2001, 2003, 2004 and 2005. Last year is an example of an August that failed to rally.

Jul 30, 2009
Institutional Advisors

Hoye Archives

The opinions in this report are solely those of the author. The information herein was obtained from various sources; however we do not guarantee its accuracy or completeness. This research report is prepared for general circulation and is circulated for general information only. It does not have regard to the specific investment objectives, financial situation and the particular needs of any specific person who may receive this report. Investors should seek financial advice regarding the appropriateness of investing in any securities or investment strategies discussed or recommended in this report and should understand that statements regarding future prospects may not be realized.

Investors should note that income from such securities, if any, may fluctuate and that each security's price or value may rise or fall. Accordingly, investors may receive back less than originally invested. Past performance is not necessarily a guide to future performance. Neither the information nor any opinion expressed constitutes an offer to buy or sell any securities or options or futures contracts. Foreign currency rates of exchange may adversely affect the value, price or income of any security or related investment mentioned in this report. In addition, investors in securities such as ADRs, whose values are influenced by the currency of the underlying security, effectively assume currency risk. Moreover, from time to time, members of the Institutional Advisors team may be long or short positions discussed in our publications.

321gold Ltd