Dr. Al Larson, PhD
MoneyTide.com
Since the gold ETF GLD was discussed in the November 30, 2018 Chaos Clinic, it has completed the forecast 7 moves in an Up Chaos Clamshell. This is shown on the chart above. In November, I expected the rally to last "into February."
The rally was steeper than I expected, due to move 5 becoming a 7 move Up Chaos Clamshell itself. This is shown by the red boxed numbers 1-7. This is a good example of the fact that move 5 in a Chaos Clamshell is often the largest and fastest and best to trade.
The moves 6 and 7 were quick, with move 7 being an obvious blow off. From there prices dropped sharply into March 6th.
So what now? The most likely pattern is a consolidation, before further advance. I think the approximately six month rally from August to February is move 1 of a much larger Chaos Clamshell. This is shown by the green boxed number 1.
One way to estimate the duration of this consolidation is to anticipate that it might look like the August through October 2018 move, outlined as a red triangle. This triangle has been copied to the end of the chart. It suggests GLD could congest until about April 4th.
If prices do this, it could be a golden opportunity to buy gold for further advance near the end of the triangle. Purchases can be protected with a stop at 120. The GLD Exchange Traded Fund is my preferred vehicle, since it can be traded by small accounts. .
To learn more about Chaos Clamshells, I suggest my Cash In On Chaos course, available at Moneytide.com
This content was published on Dr. Al Larson's Chaos Clinic which you can attend each Friday for free.
Dr. Al Larson has developed a complete Chaos Model of Markets, four unique courses that let you become a Certified Chaos Trader, some very unique eMylar fractal pattern overlays, and tools that permit forecasting individual stocks and markets years in advance. You can also sign up for a free weekly email, and attend a free Chaos Clinic on Fridays. To learn more, click on the author's profile.
Be sure to sign up for the free weekly email!
Information on this page contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these securities. You should do your own thorough research before making any investment decisions.
Recommended Content
Editors’ Picks
EUR/USD consolidates weekly gains above 1.1150
EUR/USD moves up and down in a narrow channel slightly above 1.1150 on Friday. In the absence of high-tier macroeconomic data releases, comments from central bank officials and the risk mood could drive the pair's action heading into the weekend.
GBP/USD stabilizes near 1.3300, looks to post strong weekly gains
GBP/USD trades modestly higher on the day near 1.3300, supported by the upbeat UK Retail Sales data for August. The pair remains on track to end the week, which featured Fed and BoE policy decisions, with strong gains.
Gold extends rally to new record-high above $2,610
Gold (XAU/USD) preserves its bullish momentum and trades at a new all-time high above $2,610 on Friday. Heightened expectations that global central banks will follow the Fed in easing policy and slashing rates lift XAU/USD.
Week ahead – SNB to cut again, RBA to stand pat, PCE inflation also on tap
SNB is expected to ease for third time; might cut by 50bps. RBA to hold rates but could turn less hawkish as CPI falls. After inaugural Fed cut, attention turns to PCE inflation.
Bank of Japan set to keep rates on hold after July’s hike shocked markets
The Bank of Japan is expected to keep its short-term interest rate target between 0.15% and 0.25% on Friday, following the conclusion of its two-day monetary policy review. The decision is set to be announced during the early Asian session.
Moneta Markets review 2024: All you need to know
VERIFIED In this review, the FXStreet team provides an independent and thorough analysis based on direct testing and real experiences with Moneta Markets – an excellent broker for novice to intermediate forex traders who want to broaden their knowledge base.