by Rick Ackerman, Rick’s Picks
Bulls struggled last week to hold above a key Hidden Pivot support at 1702, but their failure to endure portends more downside over the near term to 1630.50. That’s my worst case target for now, and although the chart pattern that produced it is highly unconventional, using a visually obvious ‘marquee’ high and a point ‘B’ low that failed to exceed any significant prior lows, it’s all we’ve got.
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The pattern is certainly good enough for government work, meaning a tradeable reversal from at or near D is highly likely. We will remain open-minded nonetheless toward the unthinkable – i.e., a decisive breach of the 1630.50 pivot that would imply an eventual test of the 1467 watershed low recorded exactly a year ago.
A relatively minor ‘hidden support’ at 1660.40 mentioned here earlier also remains viable and can be used to bottom-fish with a very tight stop-loss. Gold clearly does not like anything that Powell has to say, even when his obfuscations suggest the Fed will continue to pursue inflationary policies with reckless abandon. So why doesn’t gold rally on the prospect? Perhaps it understands that the inflate-or-die effort is ultimately doomed? Even so, that is hardly a reason for bullion prices to have plummeted as steeply as they have since last August’s $2100 high.
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