On October 16th, the dollar’s short term bounce probably ended. A bear flag has become the right shoulder of a significant h&s top pattern. A new and sizable bearish move would be confirmed if the neckline breaks. The mathematical target of the h&s top pattern is about 73. The inner Fibonacci arc, and resistance near 80.50, is probably limiting the upside of the dollar’s rally attempts. A decline below the neckline area at 78.50 could start a very powerful rally in both gold and silver.

A “cup and handle” pattern on the gold chart appears to be almost completed.  The handle is forming nicely, and volume is bullish.  The price target is about $2000, which is similar to the $2015 target projected by other technical data.

Submitted by Morris Hubbartt

  • On October 16th, the dollar’s short term bounce probably ended. A bear flag has become the right shoulder of a significant h&s top pattern. A new and sizable bearish move would be confirmed if the neckline breaks.
  • Some congressmen have noted that about 10,000 people sign up for social security benefits every day.  Unfortunately, political leaders seem reluctant to implement austerity measures.  They consider printing money to be the best route out of the current labyrinth of debt.
  • The mathematical target of the h&s top pattern is about 73. The inner Fibonacci arc, and resistance near 80.50, is probably limiting the upside of the dollar’s rally attempts.
  • A decline below the neckline area at 78.50 could start a very powerful rally in both gold and silver.

 

US Dollar Bear Action Chart

 

Gold Volume-Based Support Chart

 

  • On Monday, volume-based support (VBS) at $1721 almost came into play.  Gold dipped to about $1729. This decline comes after a series of lightly bearish Commitment of Traders (COT) reports, and a rise in bearish sentiment.

 

  • If the dollar is completing a top, gold is probably close to resuming its upside movement.  

 

  • Today, gold could retest Monday’s low, and then begin a steady move towards $1850.

 

Gold Cup and Handle Chart

 

  • A “cup and handle” pattern on the gold chart appears to be almost completed.  The handle is forming nicely, and volume is bullish.

 

  • The price target is about $2000, which is similar to the $2015 target projected by my other technical work. 

 

  • Are you drinking your tea from a $2000 cup?  Give it a try!

 

GDX Buy Signal Chart

 

 

  • I projected a modest pullback would take GDX to about $47.50, but this correction has been even more shallow than I envisioned.

 

  • Volume is extremely bullish. Price corrections that are this mild tend to be followed by powerful moves to the upside.

 

GDX Head & Shoulders Bottom Chart

 

  • Bullish flag patterns are apparent on many charts in the precious metals sector, including GDX.

 

  • The flag is also the right shoulder of a sizable h&s bottom pattern. When activated by a rise over the neckline, my projection is that by April of 2013, GDX will reach $77.

 

GDXJ Triangle Time Chart

  • GDXJ is consolidating in a beautiful triangle pattern.  The price is contained by the blue converging trend lines. Volume is bullish.

 

  • This triangle has been in play for about 5 weeks now, and a breakout in the next few days would make this a “textbook” chart pattern.

 

Silver Volume-Based Support Chart

 

  • On Monday, silver dipped to about $32.57.  Like gold, silver is exhibiting a very shallow price correction.

 

  • Volume-based support sits at $32.50.

 

  • There is a possibility of a short term test of Monday’s low, but my sentiment indicators showed a significant spike in investor fear.  That “fear factor” suggests the correction is probably almost over.

 

  • I expect to get a trading buy signal for silver this morning, and if you don’t have much silver, it could be a good idea to buy today!

 

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    • Except 2008, the RSI on the daily has always worked (5 times) …. and we will touching oversold on Monday (RSI=30) if the selling contiues like this. Most days the RSI was below 30 until a bottom was reached is 6 trading days so far. We will have a bottom in Silver within the next 1 or 2 weeks. 

    • @THORISHERE
      I think charts and graphs, taken in light of the fundamentals, are a great tool! Until the cartel steps in… 
      I think the upside (rising market trends) can be helpful, but many of these “dips” (lows) are manipulations, 
      as we all tend to think. Sinclair can call it “hedging” but others tend to call it what it is. Perhaps JS’s
      interpretations can be helpful, if we view it as “against the spread hedging”. Gives a wider picture with
      differing goals but the same end result. Depressed market prices, but more buying opportunities :D

       

    • @zoggl 
      Bottom in Silver in a week or 2? That is music to my ears! And it also implies that David “JP” Morgan is a DOOFUS
      because Silver will likely go UNDER $30 when he said it will never happen again, and said it THIS WEEK! lolZ
      But even better, I will be able to buy at the lows  :D 

    • Will silver go back to its lows in a week or two? Finally! This is an opportunity for me to recover from my loses in terms of dollars. I lost my last opportunity when silver was at 27$ per ounce because I didn’t have enough cash to buy some silver. :(

  1. My ignorant self has come to the conclusion that technical analysis is the denoument by diligent work (or worse) of various number cruncher types over the years of the formulas/equations/logarithms/whutevvah that the insiders use to push the patterns in a predictable way that they can keep track of, as part of their overarching plan, and also can be used by other insiders to see the signals that let them know when to pump and dump and all the rest. Also, all that strangeness with DOW numbers, double digits, triple digits, digit sequences repeating, statistically improbable, that.
     

  2. If gold reach 2000$ per ounce, then silver will also reach 36.36$ with the ratio of 55 ounces of silver for one ounce of gold. I’ll stick with silver because it is way less expensive than gold and it is way more available to buy than gold. Although, I would’ve buy gold right away if it was available for sale and if it has a low premium.

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