The Million Dollar GUNNER24 Setup

Last week, every precious metal investor/trader could find in the tissue of his own nerves what volatility genuinely means. I can’t remember to have consumed without interruption that much coffee and cigarettes ever before, and it was quite a lot. The reason is this: When the situation becomes really thrilling, when the trigger is being pulled like it was last week the time you spend in front of the trading desk seems to double somehow.

Gold finished the week with -1.3%, and after the new all-time high at 1918 on Tuesday a crazy roller coaster ride began: At first it went down by more than 200$ within three days before it rose from the Thursday low at 1705 (the new support Gann Angle) over 125$ up until the Friday close.

As I explained in the last issue already after reaching the important GUNNER24 Monthly Resistances all the warning lamps have to light up dark red to us traders since there’s the possibility of a long term change in trend (here you may internalize all the trains of thought on that subject again). That’s why we covered all the monthly long positions at 1880 – in time.

On weekly sight GUNNER24 is showing a medium term buy signal now (here’s the analysis). Target is 2009$. By the admittedly extremely savage price course last week that buy signal was confirmed once more since gold escaped back above the 2*1 Gann Angle which had clearly been broken upwards the week before last. In the week low gold did not only find a strong support at a clearly identifiable Gann Angle, but the re-conquest of the 3rd double arc and the 2*1 Gann Angle demonstrates us impressively that this upwards trend shall not have ended yet.

The brutal recovery rally after the 1705 low shows us – after the weak hands and the sub-capitalized

Speculators had to cover or turn, respectively, because of the margin hikes – that in the central banks a high buy volume keeps on dominating, which will strike in case of any "little" correction. The upwards trend is going to continue.

Full of wise foresight on Saturday I was en route with my van buying a pallet of strong coffee beans and a lot of cigarette packs since this high volatility in the gold market is going to continue the next weeks as well. Where the emotions are on touch – greed and fear – is where always the highest volatility shows. So watch out! The market is going on like it has been for the last three weeks. I reckon with everything, even with the possible reaching of the 2000 within one or two weeks if the 1892 on closing price basis are taken. As well I reckon with a new violent downwards turn after the 1879 (an important GUNNER24 mark) or the 78.6% of the Fibonacci retracement at 1873, respectively, will have been reached next Monday or Tuesday.

And now to the million $ chance!

Silver

I consciously used the million $ vocabulary… If all the readers of the GUNNER24 Forecasts, all our Gold-Traders and the institutional traders who’re in the GUNNER24 Member Area count together the profits which are possible until the end of September, in that case several millions of US$ should accumulate… and this is how it should work:

Let’s have a look at the actual daily 5 Candle GUNNER24 Up at first:

The Thursday low was marked at the 1*2 Gann Angle. Thus, this one has settled as a very strong support being supposed to resist also in case of a third possible test and producing a new rebound. As I said, silver rebounded mightily from the 1*2 on Thursday targeting again the resistance double arc now. Target until Monday/Tuesday will be the 42.60 to 43.00 area. That should be congruent with the gold target on daily basis of 1882-1873.

Technically, being a resistance double arc, a new violent rebound downwards from this target area should happen. If such a rebound does not occur or if silver wants to consolidate at the target area until Wednesday everything will be clear anyway… it’ll continue going up!

But if a rebound from the target area happens the depth of that rebound will be decisive – and therewith we’ve arrived at the Million Dollar GUNNER24 Setup – the monthly silver GUNNER24 Up Setup:

Pay attention to the actual August candle in this setup, please! It is following the setup in an extraordinarily accurate way:

Its top is lying exactly at the natural resistance in the middle of the just passed square.

It’s opening precisely at the rally Gann Angle which correspondingly should force the market upwards for the next months as well. Everything will fit if August closes above it. It finds its monthly low (37.025) at a natural support diagonal.

With the Friday closing it is quoting exactly below a clearly identifiable resistance diagonal which had shown its effect by the July high already.

And at the moment, at 41.725, it is closing above the 4th double arc. That’s a buy signal with target 47.10$. So, if silver stays above 40.70 until Wednesday (I don’t doubt it will!) silver will generate a confirmed monthly buy signal! If silver closes above 41.725 which is the actually important resistance diagonal the buy signal will be even more impressive.

Conclusion: Now it depends on how silver performs in the daily setup at the 5th double arc. A violent rebound from it and a August close below 40.70 would not lead to a monthly buy signal. But I think that silver will close clearly above 40.70. And that results in the opportunity to build up the first long positions without a risk at the beginning of the week. Target will be AT LEAST 47.10!

If silver closes above 40.70 producing a very, very seldom monthly buy signal – who could doubt in the 2000$ in gold in that case? There’s no doubt above all if we consider the result of the last monthly silver buy signal. February 2011 made it: From 33.82 it rose straightly and un-braked to the 50$ then. As I said: A million $$$$ chance!

You best register with our GUNNER24 Gold Trader now. That’s where we oversee the optimal entries and exits for you. Especially in the difficult market situations where many factors have to be considered the Gold Trader is backed by the additional GUNNER24 Signals based on the combined 1, 4 and 8 hour setups to catch the optimum entries and exits.

To close this issue: Just a brief check of the US stock market

During the last weeks the S&P 500 we last analyzed on August 14 performed as forecast. Here’s again my analysis on the S&P 500 on daily basis of that date:

Two weeks ago I expected a soon rebound down from the extremely resistant 4th double arc which should have led the market back to the 5th double arc. Then, after an intense test of the 5th double arc the S&P 500 should turn upwards again near the 1140 support in order to start at last an extensive counter reaction in the direction to 1240 - 1250 after the final break of the 1*1 Gann Angle.

The actual state of the 12 Candle GUNNER24 Down shows us that the market has reached the phase of the final decision now: either going on upwards or definitively diving down.

Below the 4th double arc at about 1200 the first test of the extremely important 1*1 Gann Angle took place which couldn’t have been successful, as expected. According to W. D. Gann the important Gann Angles can’t be broken successfully before the third test.

On Thursday this resistance Gann Angle was reached for the second time, the S&P 500 had a quick look above it but it newly rebounded very violently from it. By the Friday low at the strong horizontal square line support at 1136 a turn followed which made the market close at the 1*1. It was the 3rd test! By that all the pre-conditions are given to "allow" the market to finally break the 1*1. So, as early as Monday or Tuesday the final break upwards may succeed what I really assume. The target for the expected counter reaction keeps being the 1*2 Gann Angle at 1240 to 1250 the 5th having to provide durable support which is supposed to back the market several times in the course of September. After reaching the 1*2 the market is expected to turn downwards again severely.

But maybe the 3rd or the 4th test of the 1*1 Gann Angle proceeds negatively. So, proving the Gann Angle as to be a too strong resistance would make at first the 5th double ark finally break and would consequently in the further course lead to some new year lows. A closing price below 1138 until Wednesday would be a clear indication to this course. But I think the probability of the final break of the 5th until Wednesday is but a 20%.

Be prepared!

Eduard Altmann