Here are the relative performances of $US Gold, the $US Index, and the Dow since Gold broke above $US 300 on March 27:
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If Gold's gain had exactly mirrored the loss on the $US index since March 27, Gold would have closed on July 5 at $US 329.60.
Here's another perspective - a comparison between Gold's 2002 low and its present price and the $US index 2002 high and its present "price". All data is on CLOSING levels:
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As you can see, Gold is still further above its 2002 low in percentage terms than the $US index is below its 2002 high. The gap is still narrowing.
Over the last week of June, U.S. investment banks persistently sold Gold so that it FELL along with a falling U.S. Dollar and a plummeting stock market. This week, Gold only traded over the first three days, the Comex was closed on July 4 and 5.
"Of course, the manipulation is transparently blatant. For the past three weeks, Gold has NOT done what it could have been expected to do given the weakness on markets and the falling U.S. Dollar. But there was a G-7 meeting on June 15-16, the FOMC met on June 25-26, and the G-8 met on June 26-27. Any REAL ructions on financial markets had to be avoided while all that was going on."
(The Gold Bull Market - June 28)
The Fed stood pat on June 26. The G-8 meeting broke up with no communique on June 27. The U.S. House of Representatives passed a $US 450 Billion increase (to $US 6.4 TRILLION) in the debt limit on June 27 and President Bush signed it into law on June 28.
From July 1, the U.S. Dollar began a "recovery". Then there was the holiday on July 4, and now U.S. stock markets have seen their biggest one day rise this year - on July 5.
And finally, here's one final perspective, comparing Gold's 2002 high set on June 4 with its level today.
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As you can see, the $US Gold price has fallen considerably further than the $US index has fallen since Gold hit its 2002 high on June 4. If the action on spot future $US Gold had "mirrored" the action on the $US index since June 4, then Gold would be 2.73% ABOVE its June 4 level of $US 327.80. That would put Gold at $US 336.75.
Gold has broken below the "accelerated" uptrend lines on both daily and weekly bar charts. On the point and figure chart, it remains above the top of its up channel. The correction is clear, the underlying uptrend is equally clear.
What happens now is simple. We must await evidence of solid support.