After two weeks (Oct 4 - 18), Gold lost $US 9.40 ($US 322.10 to $US 312.70). This week, it has actually got some of it back. Admittedly, it's not very much :-). This week (Oct. 21-25), Gold actually gained all of $US 0.70 - after setting a new low close for this October pullback of $US 310.70 on October 24.
The reason Gold stopped going down this week is that the US markets stopped going up, or at least stopped going up at anything like the same speed they had been going up since they hit 2002 lows on October 9. And through it all, the $US index remains almost frozen in place. To give you an example, the $US index closed on September 26 at 108.15. It closed on October 25 at 108.17.
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 October 25 at $US 329.50.
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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On the daily bar chart, you can see that Gold popped back above its shorter-term (10 day) moving average on October 25 for the first time this month. The shorter-term (10 day) average remains below the longer-term (20 day) one, has it has been since October 10. On the weekly bar chart, Gold has bounced off its longer-term (20 week) moving average this week, just as it did at the bottom of its last correction in late July. And on the point and figure chart, Gold is still pointing down. An upturn on this chart would require a spot future Gold close of $US 314 or higher.
And finally, here's one final perspective, comparing Gold's 2002 high closing level set on June 4 with its level today.
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Gold's loss since its June 4 2002 high is still quite a big bigger in percentage terms than the loss on the $US index over the same period. If the action on spot future $US Gold had "mirrored" the action on the $US index since June 4, then Gold would be 2.69% ABOVE its June 4 level of $US 327.80. That would put Gold at $US 336.60.
As already stated, Gold has stopped going down as US stock markets slow preciptously from their big rally of mid October. Meanwhile, the US Dollar runs on the spot. US mid term elections are now just over a week away (on November 5). The war on Iraq is in limbo as the horse trading in the UN Security Council continues.
Technically, the signs point to Gold having found support just above the $US 310 level on a spot closing basis. The best illustration of this is the longer-term (20 week) MA on the weekly Gold bar chart. Gold has not been below this MA since late last year. It has now come down to "touch" it for the second time since it set its 2002 high way back on June 4. If Gold is to continue to recover, it should hold above $US 310. If it doesn't, then the "senior" uptrend - the one going back to the start of this bull market in April 2001, presently stands at about $US 292-293.