Remember the brown horizontal area I showed back towards the end of March telling us that we had just made a lower low and that it was time for some caution? Just a simple thing as making a lower low after a nice run was enough for me to take cover until things became more clear. Well things have become more clear as I have been using fanlines off of the March triangle low to project support and resistance points in this reaction off of the all time high of 1033. As you can see each fanline has acted as support and then when broken acted as resistance from the underside. The last 3 days tested the 3rd fanline from below as resistance and now we are giving way to look for support at a possible 50% retrace of wave 1 of III down to the 82.02 area.
hub3.png
Below is one more look at GLD without using the dreaded H&S pattern that so many here feel is invalid or without merit. I’m using the DZZ, top chart, that is showing the inverse relationship to GLD. Notice the bearish rising wedge halfway pattern on the bottom chart of GLD. If this plays out as a true halfway pattern then we still have a ways to go yet to reach our next bottom at roughly 79.40. If we get down to the 76 area on this run, the bounce will be the most important bounce of this whole bull market in gold for me as that rally will tell the tale.
All the best…Rambus
dzzzz.png