Forecast - 2013.10.27 : Reason To Trade

Reason To Trade:
1. The last H4 Candle was rejected by the resistance.
2. There is a Bearish Divergence. Last time it has divergence, the price went down significantly. Will it also be like the last divergence?
3. William's Percent Range is in the extreme overbought area and begin to facing down.
4. Risk Reward Ratio seems pretty good to me.

Well, let's see where it'll go. Will it going down as predicted or it just continue going up.
Disclaimer on.

GG - 2013.10.28

Forecast - 2013.10.26

XAU is clearly in an uptrend. The clear path is between the Red R/S trendline.
But there is another Resistance that we have to pay attention. Just see the green Resistance.
Gold has been rejected several times around that Resistance. And the last H4 candle also been rejected by the time I write this.
This H4 candle will be completely done in around 2 hours from now and will be the last H4 candle before the market close. This candle will be the key candle. If it forms a doji / inverted hammer / evening star, then I think there is a big possibility that gold will have a pullback downside a little bit.
Just take care and have a nice weekend.

GG - 2013.10.26

Forecast - 2013.09.22

HOW LOW THE BEAR CAN GO?

After having a significant jump on Thursday, right after FOMC, gold has been plunged almost 4,400 pips.
Although I have predicted that gold could not go higher than 1375 because the Resistance was  obviously very strong (R/S Lines and Fibo, see my previous post), but I also didn't expect that gold would dive that far so quick.
Luckily, I have anticipated the move, I still could take profit.
Now, let's see the eternal question that always pops up everyday, where the gold will go next?

From H4 Chart, we can see that gold has touched 61,8% fibo and went up a bit before it closed.

Zooming to H1, we can see that the last bar formed a very small pinbar.
Although this is not a very clear sign of reversal, I think we also can't ignore this. I suspect gold down move can be restrained around this area.
But to say that it will go up or down, we need more confirmation.
If I have to guess, I think gold more likely to go up than to go down. Let's see tomorrow.

Let's see one more chart.
I put the previous Fibonacci (originally used to measure the spike last Thursday), we also can see that gold closed exactly at the 23,6% Fibo.
That was an interesting "coincident".
Or is it a sign? :)




My conclusion:
More likely gold will not go lower and possibly it'll go a little bit upside.
Disclaimer on.

GG - 2013.09.22

Forecast - 2013.09.20

HOW FAR THE BULL WILL GO?

Last FOMC yesterday (Thursday, Sep 19, 2013), The Fed announced that they maintain QE and didn't do the tapering. As the result all pairs moved significantly and gold also jumped instantly.
The question is, to what level?
At the time I write this forecast, gold is running around 1372.
Let's try to analyze gold move.

Daily Chart No. 1
Analyzing tools: Fibo and Trend Line
Look at the daily chart no.1
It is interesting to see today that gold's daily move is limited by the Resistance that also acts as previous Uptrend Support (blue line).
As we can see, the gold's stuck exactly by 2 significant technical tools that is 61,8% Fibonacci Lines and R/S Lines.


Daily Chart No. 2
Analyzing tools: the same as no. 1 (Fibo and Trend Line)

Actually, this is not the right way to use Fibo for current moves. This fibo is used to measure the previous downtrend. But I like to show you the interesting fact that by using the previous fibo, we can see that gold uptrend moves is also restrain exactly by 23,6% Fibo lines that cross exactly with the trend lines (blue lines).


Daily Chart No. 3
Analyzing tools: Chart Pattern

By the time I capture this chart, there is still 3,5 hours left to complete this daily bar. It's interesting to guess, whether today bar will be a Pinbar (Evening Star) pattern, or will it be able breaking through all the resistances (Fibo and trendline, as no. 1+2 above)



M5 Chart

Look at the Light Grey box at the upper side of the chart.
From this M5 Chart, we can see that gold has been trying 4 times to break the resistance area (grey area), which also the same level as Fibo in no.1 and no.2 above.
Interesting isn't it?


My conclusion:
There are 2 alternatives.
1. Gold fails to break this Resistance Area and going down a little bit. If this happens, I don't think gold will drop much since we already know that tapering is cancelled for this moment and there is no certainty when the Fed will start tapering. So, I believe gold won't go all the way down in the short time.
2. Gold manages to break the resistance. Then the next resistance area will be around 1385-1390. I doubt it will go further than that for this week.

For me, the most possible scenario is that gold will make a sideways move between 1360 and 1375 area.
I will trade tick-tack between this area, buying at support and selling at resistance. Just beware if the price manages to break this temporary area. If that happens, just switching the position and get along with the breakout.

As usual, please keep in mind that this is only my prediction. Do not trade based on my prediction only because I do mistakes too. Disclaimer on.

Good luck.

GG - 2013.09.20

Forecast - 2013.08.10

After being absent for some time, finally I am able to find time to post my forecast.
Gold had been really pushed all the way down and now it seems that the bull is fighting back.
Let's take a look at the weekly chart below

Gold had been extremely bearish for weeks. There was a time when gold tried to break the support of the downtrend path on mid of April but it was rejected and the price went back into the path.
The second time it tried to break the support and once again rejected by the market and the price went up this time. The interesting thing is that gold has been moving between the 23.6 and 38.2 fibo lines. It looks for me that market has not decided yet where gold must go. In this kind of situation, I think some big news can play a big role of defining where gold will go.

Now, let's zoom to the daily chart as seen below.

I think gold is making a wide sideways move. It is too early to say that it will go up yet because I see a very strong resistance around 38.2 fibo lines. Almost 2 weeks gold has been trying to break this resistance area (grey color) and hasn't been succeeded yet. But if it successfully breaks this area, I will not be amazed to see a strong move up to 1480-1490 area.
Meanwhile, more likely gold will move a little bit sideways with tendency a little bit down between 2 lines as drawn on the chart.
Actually, this is a perfect condition for me for applying the Scalping Path Method. It suits more in sideways rather than trending market. Since June 20th (about 1.5 months), it's already gave me 63.5% profit in one of my gold micro account.

GG - 2013.08.10

Forecast - 2013.05.30

As predicted in the last posting, both Gold and Silver (not shown here) form morning star chart pattern and the price goes up.
My timing entry when gold break resistance at 1398.

Question: when will it go next?
From weekly chart it is obvious to see that gold has just begun to move from oversold area, so I think it will move more to the upside. Let's see to a smaller TF, H4 chart below.

 
From the H4 chart, we can see clearly that gold form a nicely shape Higher Low base., showing that this uptrend is strongly supported.
But in this H4 chart, we also can see a resistance, actually 2 resistances for me and RSI + William % Range also shows overbought in H4 TF.
In my opinion, gold will have some pullback, but not too far. It might go once again around its up-sloped support and then bounce back to the north, since the weekly chart is still shows extreme Oversold condition.
Let's see.

PS: Disclaimer ON.

Good luck.

GG - 2013.05.30

Forecast - 2013 05 24

IS THIS THE RIGHT MOMENT OF THE "BULL"?

For the past few weeks, we've been watching how the Bear beat the Bull so hard.
The drop of the gold price is the the worst drop ever for the last 30 years. Nobody knows exactly what the true reason is. I will not try to look for the reason, I just want to try to predict the next move of the gold.

Let's start....

Analysis No.1

This is my gold weekly chart. It is a plain chart with only RSI and William % Range in other window.

Many traders often underestimate these indicators and consider them as lagging indicators. Yes it is, IF, you are a short term trader, but not for medium or long term trader.
I love these indicators because they tell the condition of the market, whether it is overbought or over sold. Of course I will not make the lesson about these indicators here, just googling and learn it by yourself.
The point is, when the market is overbought USUALLY the price will going down, and vice versa, if the market is oversold USUALLY it will then going up. If you don't believe me, just look carefully at the chart above and you can notice that both indicators tell exactly the same.
Now, please look carefully from that Weekly Chart, RSI (the red line) is in the extreme OVERSOLD area (under 30). The last time weekly RSI in this oversold area is in the September 1999. Almost 14 YEARS AGO !!!
The William % Range (with different algorithm to calculate overbought and oversold, but similar result), also in the extreme oversold area.
Both indicators point that this is a set up for bullish.
Wait a minute!!! Of course I know your objection. When these indicators are in the oversold area, such as this moment, it is not automatically show that the price will go up instantly. I know there is an exception. In a very strong trend, as can be seen in the same chart above, these indicators, sometime, can stay in the oversold area but the price is keep going down, and vice versa. Yes, I know that.
But please judge by yourself, are we in a very strong bearish trend now?

Analysis No.2

Silver - weekly

Gold - weekly

Let's see Silver and Gold weekly chart. If today (end of week) closing, silver and gold price doesn't go much lower than current-chart-low, there's a probability that it will make a Morning Star pattern.

Analysis No.3

This is the most convincing data that I have so far.

Look at the chart above. That is the weekly chart with 2 indicators, the Open Interest and the Commitment of Trader. Both data are official data from US CFTC (US Commodity Futures Trading Commission), the official US government bureau that collect weekly commodities data, including gold, from all US market.
I will not share how to use these data here. For those who has known the important of these data in the trading will know what I mean. (Please find a way to get assistance from around you to  learn how to use these as it is impossible to share the knowledge here).
The point that I want to show  here is, that we are having the similar conditions compare to the end of year 2008 when gold begun a long rally.
The Open Interest shows the lowest figure (significant drop in the last 2 weeks) and the Commercial shows the highest figures, both since the end of 2008, when the gold rally begun.
Why it is so important? Because the Commercial is the market mover. No one can beat them, not the large trader nor the speculators.
Both indicators show the set up for a bullish gold price. Of course it doesn't mean the bullish will happen tomorrow, but the most important thing is, we already have the signal that a bullish setup for gold is near.
Just be prepared .

Analysis no.4

One of my favorite traders is Larry Williams. Actually, I learn about COT, Open Interest, and many more indicators because of his book, Cracking The Money Code. I found it very helpful and logic. Some of his secrets of being successful trader is because he use the reliable and valid data. So trading is not only about luck. It is about what reasons you have to make a smart speculation.
One of his tools is Advisory Sentiment Index. Sorry I don't have anything to show here about this tool.
The point is, when most of the advisers, media, brokers, anyone, are bullish then probably we are already in the market top. Vice versa, when most are bearish, probably we are already in the bottom of the market.
Now, let's think about it, how many experts or people have you heard are bullish about gold lately? None?
Yup... Everyone is really bearish at these moment. Is this a sign?
You decide....

My Conclusions

Yes, I'm begin to be bullish at this moment. Now I'm preparing myself to face at least a significant correction of the gold price (and also silver) if we can't say a rally.
Of course as I say earlier, it might not happen next week. It might happen next month. It might also the gold price can drop further. But at least, the set up for bullish conditions is already there.
Always use a good money management and discipline.
Wish all of you have nice profit.

Note: Disclaimer always ON.


GG - 2013 05 24