On November 9, 2016, the 1338.30 Trump-spike high tested back exactly the 1*1 Gann Angle that had been broken downwards a couple of weeks before. This important 1*1 Gann Angle springs from the momentary bear market low of Dec 3, 2015, so the 1*1 Gann Angle is matter of a magnet in the yearly time frame.

The Kiss of Death of the yearly 1*1 Gann Angle magnet at the Trump-spike high led to a dramatic sell-off. Within but 26 trading days, the precious metal lost far more than 200$ to generate ultimately a stable panic low on Dec 15, 2016 and its 1124.30$ likely higher 1-year-cycle low.

On November 9, 2016, price met time. Besides, since – to cap it all – the nearest gold-futures contract showed its highest trading volume ever by far, at 1338.30 gold cemented and finalized not only an important lower high for 2016 and an important next lower high in the overall bear market, but also another resistance horizontal in the yearly time frame with future importance. Now, those 1338.30 represent the very most important resistance for gold in 2017 – and of course for the subsequent years as well.

 

 

Regarding the argument gold in the bear market vs. gold in the bull market and for rounding the Big Picture at the same time, thereby is valid this: Only if gold is able to trade above the 1338.30 in the course of the year 2017 or afterwards, it will have to keep on rising prospectively because in that case it would have lost officially its present bear market status.

==> As long as gold trades below the 1338.30, it will keep on being in the bear market. Above the 1338.30 it will be in a new multi-year bull market.

We’re getting now to the main topic of this issue: gold at the crossroads once more! Let’s have a look at the presumable course of the coming couple of weeks:

Above, the most dominating weekly up, the 15 Candle up, with starting point at the December 2015 bear market low. Last year, several times I explained and presented its structure and buildup, its importance in respect of signaling and the expected future trends/cycles. Inter alia, captioned "Days of Thunder" on 10/23/2016 and "Stocks and Gold into US Election" on 10/09/2016.

Let’s begin the crossroads forecast at the # 1, the potential higher 1-year-cycle low of 12/15/2016, reached at 1124.30, released by the existing + strong Support Angle in the DECADE TIME FRAME. Thus, both the current bear market low of December 2015 (Dec15) and the higher low of December 2016 (Dec16) were enforced by a support in the decade time frame.

Since the Dec16 # 1 low gold has been bouncing upwards. The # 2-low was likewise reached at the DECADE Support Angle. The day before yesterday, it closed at 1197.30, thereby ending the 5th bouncing week with another higher bounce high, higher bounce low and higher bounce close in the weekly time frame.

# 5 was able to open within the lines of the 1st double arc. Alike, the # 5-low is within the lines of the 1st. The # 5-low is at 1172.20!, # 5-open is at 1172.90!! Thereby, the # 5 opened and the # 5-low tested very successfully the important monthly 1172 GUNNER24 Pivot/Horizontal. Another bouncing upwards push was triggered at the 1172 monthly support!! Thus, gold kept on rising in the course of # 5! Indeed, it rose by almost precisely 25$ from # 5-open till # 5-close. 25 is half of 50!

By the way, the importance of the xx22 resp. xx72 magnets for gold in 50$ intervals continues. This condition is going to remain important for many more years. New readers may red up here what it’s all about with the 50$ resp. 25$ steps gold has been respecting since the year 2012 in a downright maniac way.

Coming week will be the 6th of the bounce. Since # 5 triggered another test of the upper line of the 1st with its positive course, gold will – with a probability of nearly a 100% - reach/work off the upper line of the 1st in the course of next week.

==> The upper line of the 1st is at 1205 for coming week! Well, since we identified the important intermediate low at the # 1, the upper line of the 1st double arc was the logical venue resp. upmagnet for the current bounce move. The upper line of the 1st has often been tested negatively. Mind about this the many lower weekly highs in 2016 triggered by the upper line of the 1st magnet = 2016 main resistance.

There were only two serious attempts to overcome the upper line of the 1st on weekly closing base in 2016. Both broke down at the orange arrows. During the week of the Trump-spike high, the upper line of the 1st clearly was pierced by a large amount, but at the same time, gold was rejected by the upper line of the 1st double arc in a heftiest way. In the Trump-spike high week also the last negative test of the upper line of the 1st ensued.

The 1st double arc environment by itself is resistance double arc in the yearly time frame, cause that’s where not only the final high of the year 2016 was brought in as well as the important lower countertrend high of the Trump-spike high and many more lower weekly highs were.

==> The 1st double arc was most important resistance for 2016. Technically, it’s going to remain the most important resistance for 2017 as well, until it will be clearly overcome on weekly closing base.

==> It will take a very first and very clear weekly close above the 1st to activate additional upwards potential = bounce potential.

==> So, technically, gold should have to shape an important lower bounce high at 1205 and the upper line of the 1st in the course of next week in order to test back then – as sketched with the red dotted arrow – the DECADE Support Angle till mid-February/beginning of March 2017 once more. If that one doesn’t provide support any longer then – quite possible because gold is confirmed to be still in the bear market after all! – the blue dotted arrow outcome will happen = 1000$ test and lower till June 2017!

Approaching point of the second part of the crossroads analysis is the weekly high that tested the upper line of the 1st negatively for the very first time. This high, depicted with the purple arrow was the first important lower week high AFTER the final 2016 high…

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At the end of today’s issue, I annexed – without any word of explanation – the monthly gold chart from the Gold Trader issue 12/19/2016 that clarifies the derivation and deduction of the DECADE Support Angle and thereby also the importance of the potential higher 1-year-cycle low of Dec 15, 2016!

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... This high, depicted with the purple arrow was the first important lower week high AFTER the final 2016 high… this first important lower 2016 high triggered thus "officially" a downtrend in the weekly time frame gold is still in:  

 

 

The week of the first important lower 2016 high – purple arrow – was the 35th week after the attained Dec15 bear-market low. Therefore it is in striking distance of the 34 Fib number regarding the Fib count, and thus this high means a natural important turning point in 2016. Tracing the Blue Arc into the high of this week, we realize that the thereby automatically resulting Blue Arc is another arc resistance in the yearly time frame gold has obviously oriented by with its subsequent lower weekly highs.

Thus applies this: The Blue Arc is multi-confirmed resistance arc in the weekly + yearly time frame! It is multiply confirmed weekly high as well as weekly closing base resistance. It is another strong resistance for 2017 that will have to be overcome, first of all. And – as happened before – it will take a decisive weekly close above the Blue Arc to overcome it finally.

==> Since the Blue Arc has provided important and above all tough resistance, in my opinion it is not advisable to work on the assumption that gold can go above it in the current bounce move!

==> The current gold bounce should have to come to its end at the latest by reaching resp. testing the Blue Arc above. Technically, gold should have to fall again after the next test of the Blue Arc, possibly – if the DECADE Support Angle happens not to bear – even dramatically deeply!!!

The probability for the DECADE Support Angle not to bear at the next test – expected for mid-February/beginning of March – is to be considered as being as low as a 10%, because at the Dec16 low a higher 1-year-cycle low was most likely to have been reached. This constellation normally means that a several months lasting upcycle started there that is supposed/allowed to be corrected only in the coming decline cycle!

==> Ergo, the next weekly down cycle is only expected to correct producing a next higher low in the weekly time frame at its end in order to begin then a next multi-week upleg with a 90% of probability that is likely to be able to reach the 1272 GUNNER24 Upmagnet someday in spring!

==> For the coming bounce week # 6, the Blue Arc takes its course at exactly 1215$. If gold is really able to reach the 1215$ in course of next week, a pretty riskless short-engagement for a multi-week decline back to the next DECADE Support Angle test will be offering itself there.

==> Indeed, the gold bounce is obviously struggling with the "round" 1200$ threshold that is likewise a "natural" final uptarget for the current bounce:

Last Thursday, gold closed at 1199.80. That was the highest daily close in the bounce. Last week closed at 1197.30. On top, last week reached 1207.20. There is the thread that gold will deliver an important lower bounce high at 1205 in the course of next week to begin from there "officially" its next downcycle ==> because the upper line of the 1st main resistance in the weekly 15 Candle up setup will be reached!

BY ALL MEANS I think that gold will reach the 1215 yearly Blue Arc resistance very quickly as soon as the high of # 5 will be exceeded in the course of next week.

==> Thereby this signal situation results for coming week: If gold trades above 1207.20 in the course of next week, the 1215 should have to be reached till Friday next week, technically.

Considering the weekly 36 Candle up above, I can even imagine quite well that quotations above the 1207.20 will be able to chase gold to the 1220-1222 major 2017 resistance in the short term.

1222 is again yearly GUNNER24 Horizontal Resistance since the year 2016 closed clearly below. 1220 is where the 1*2 Resistance Angle, broken downwards in November 2016 takes its course for next week. "Ideally", gold might reach that one in a next "Kiss of Death" exhaustion testing it back negatively!

Derivation and deduction of the DECADE Support Angle:

 

 

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Be prepared!

 

Eduard Altmann