A pretty "bland" week this week, with Gold down a grand total of 50 cents. So far, the $US 8.80 rise to $US 314.30 on August 7 has been nearly frozen for the past seven trading days. In fact, on August 15, spot future Gold closed at exactly that $US 314.30 level, before falling $US 0.60 on Friday (August 16). Once again, Gold is ignoring the U.S. Dollar. This week, Gold lost 50 cents while the $US Index began falling again, down 1.53 points or 1.41%.
Here are the relative performances of $US Gold, the $US Index, and the Dow since Gold broke above $US 300 on March 27:
|
If Gold's gain had exactly mirrored the loss on the $US index since March 27, Gold would have closed on August 16 at $US 332.75.
It is time once again to emphasise what a CRITICAL point the $US Gold price has reached. To do that, we draw you attention to the Monthly bar chart back to 1975.
Note that we have included an "insert" with this chart which magnifies the action since late 1999. Look at the "top" trendline, the one connecting Gold's $US 850 all time (closing) high of January 1980 and the February 1996 high of $US 414. That February 1996 high was the top of Gold's last bull market. Please realise that this (down) trendline is the LAST hold on Gold. For the past four months (May, June, July, August - so far), the Gold price has been challenging that line.
If you look at the steeper lines drawn from the January 1980 high, you can see that Gold broke above the first one in mid 1986 and above the second one in early 1993. In both cases, Gold went on to post bull markets. Now, Gold is threatening to break through again, while being pushed sideways into a dwindling trading range between the downtrend line and the VITAL $US 300 level.
When it happens, Gold breaking decisively above this downtrend will be THE signal that the PTB (powers that be) have finally lost control of it. And you may be sure that the PTB know it. That's why Gold has been "underperforming", in relation to the weakness of the Dollar, ever since it threatened to get OUT OF CONTROL in late May/early June as the price approached $US 330.
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:
|
These percentage moves, upwards on Gold and downwards on the U.S. Dollar index, are coming closer and closer together. We are approaching a situation where they mirror each other.
This week, the two bar charts on this page have improved. On the daily bar chart, the shorter-term (10 day) moving average (MA) is again above the longer term (20 day) one with the price resting right on the shorter term MA. On the weekly bar chart, the price has regained its shorter term (20 week) MA. The point and figure chart is exactly the same as it was last Friday.
And finally, here's one final perspective, comparing Gold's 2002 high set on June 4 with its level today.
|
Gold has still fallen further than the $US index has since the spot future price 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 3.84% ABOVE its June 4 level of $US 327.80. That would put Gold at $US 340.39.
Please note that if Gold had mirrored the action on the $US index over the period since it broke through $US 300 on March 27 or over the period since it hit its 2002 high on June 4, the spot future Gold price would now be ABOVE $US 330. That would have challenged the control of the PTB severely. And that's why Gold has NOT mirrored the performance of the Dollar - yet.