There has been a daily-scale bottom extension in Gold. This is not the first warning that declines will end hereabouts as we also saw a weekly-scale bottom extension last week. This week has brought a bit more weakness, so there will probably be another similar weekly-scale signal that we will only see after tomorrow’s close. One weekly and one daily signal are enough when combined to provide a chance to cover any shorts and to take a long position.
We didn’t have gold on our list of commodities to short-sell this time around but our longer-term view of gold has been bearish since monthly-scale top extensions at the highs of the bull market in August 2011 and we should point out that we do not have an equal and opposite month-scale bottom extension here:
This may just mean that it is time for a bounce, but it could be a substantial one, so buy now.