Comment: This week’s smart bounce has taken prices from the 26-week moving average up to the 9-week one. This is potentially a ‘bullish engulfing’ candle which would form an interim ‘double bottom’ against 50% Fibonacci retracement support. Adding weight to this view is the fact that corrective wave C is 0.60% of the A leg and comes in just ahead of long term trendline support. The bounce has helped keep long term momentum bullish and comes at a time when gold had become very oversold. Also, as always, nice that this has happened when many have walked away from commodities as the asset class ‘du jour’, and to hear that consensus opinion is against this view. When priced in Euros gold is already almost at record high (€807), though in terms of barrels of Crude Oil it will buy it is at the long term mean of 15.00. Platinum Group Metals look similar if more dynamic but unfortunately Silver does not back up our bullish view.
A weekly close below $1000.00 forces us to review.
