"This page will be updated on any spot future Gold close ABOVE $US 300 - whenever it occurs. We think that there is a very good chance that such a close could occur in the coming week. Stay tuned".
(The Gold Bottom Last Week - March 22)
As you know, spot future (April) Comex Gold rose $US 5.40 on March 27 to close at $US 302.20 and then rose another $US 0.40 on the last day before Easter - March 28 - to close the week at $US 302.60
There have been five spot future Gold closes so far this year:
The first thing we want you to do is take a gold look at this chart - it will open in a separate window. Pay particular attention to the uptrend since the double bottom was set in the mid $US 250s in April last year. Note the three "spikes" - in May 2001, September 2001, and now in February/March 2002. After the May and September 2001 spikes, Gold retreated right back to its trendline and took quite a long time to consilidate before moving up again - remember this is a weekly chart. When Gold broke through $US 300 for the first time this year back in February, it did NOT fall back to its trendline, or anywhere near it. And now, Gold has broken above $US 300 again - in less than two months.
If this chart as a whole is not a technical map of a bottom formation, then we have never seen one in 25 years of technical analysis. The Gold uptrend, which will celebrate its first anniversary on April 11, 2002, is crystal clear. The indicator that pressure is building under the Gold price to force it higher is the simple fact that Gold did NOT correct back to its trendline after the first $US 300 breakthrough in February. The one caveat remaining, as it has remained through all the previous surges above $US 300 since 1997, is that Gold has NOT YET consolidated above the $US 300 barrier.
But in the year we have been waiting since the bottom was estabished, the Gold price in $US terms has risen by 18.4% and Gold stocks as measured by the Australian Gold stock index have risen by almost exactly 100%. All this has happened BEFORE a $US Gold bull market has had its final confirmation.
The situation right now is quite similar to what happened in 1985-86. Gold actually bottomed in March 1985 but it didn't really get going until June/July 1986. Neither did Gold stocks. This time. Gold bottomed in April 2001, and hasn't really gotten going yet. And this time, Gold stocks have doubled in a year.
As anyone who has been reading these pages for any length of time will know, $US gold has been in a steady and unbroken uptrend ever since April 2001. This is Gold SECOND poke over $US 300 during this uptrend. Will THIS ONE be the one which changes the uptrend into a BULL market? Given the fact that the effort to keep Gold down is unabated, but is having less and less effect, we think it will be.
Technically, we are in the same position as we were in early February, when Gold poked its head above $US 300 and stayed there for three days. However, as already pointed out, the correction was shallow and we are back over $US 300 again. Have a good Easter break. This page will be updated as and when necessary, especially if Gold slips below $US 300 again or, alternatively, if it accelerates from its present position.