Gold collapse imminent? 7hr chart

24 באוק׳

Price action on Gold since August as shown on the above 7hr chart.

A Euphoric rally in the last 3 months has Gold bugs jubilant in celebration with a record 48% win from September 2011 (Ignore the 480% return of the S&P 500 in the same period).

There are now messages aplenty calling for 5k and beyond. Who knows. One thing I do know, a common theme throughout the messages, people are euphoric. Market tops print with euphoria.

Now this idea is not about who is wrong or who is right, congratulations if you've made a profit. The point of the post is to make sure profits are realised. A profit on paper is not a win and the bubble may now be about to pop. 90% of folks long on gold will not collect the recent gains.

Why might the party be about to end?

A few reasons..

1) Price action support is broken. This is also true for RSI.

2) Throughout history RSI above 80 on the 3 week chart (below) has been a warning shot for extreme overbought conditions. Look left. Corrections between 20% and 50% are recorded.

3) Price action is at historical macro resistance (see 2 month chart below).

Is it possible this time is different? Sure.
Is it probable? No.

Ww

3 week


2 month

31 באוק׳

עסקה פעילה

Market resistance confirmed.
Take profits.

שלשום

עסקה פעילה

4 Day Gravestone DOJI print with confirmation.
Is Gold about to crash 25% to 2k for a support test?