Major correction in gold seen if price breaches $1500


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Will gold sell off? A possible bearish forecast using Gann method of analysis.

After hitting its alltime high of $1911 per oz in early September, Gold has seen its price consolidate in the $1,525 – $1,800 range for nearly 10 months now . Since then much has been written about the the future course of the gold price. While the gold bulls have been belligerent in their calls for a price of $3,500, the perma-bears have been advocating a $600 price target. I myself am a gold perma-bull and while I believe that the current fair price of gold should be anywhere between $5,000 and $10,000, it is no denying that gold could see a major correction on way to that target. And with the vested international banks determined to to keep a lid on the prices of gold, a major correction could follow.

In this blog post, I try to play the devil’s advocate to my bullish bias and attempt to formulate a possible bearish scenario and how it could unfold using Gann Technology. Since the low price of $255.10 printed on February 16, 2001 the gold price has experienced 4 bull forms (campaigns) as shown in yellow in the chart below. As per Gann, there can only be a maximum of 3 to 4 forms (uni-directional moves) in any bull or bear market. Further Gann has also stated that major bull markets often span a decade and it is no surprise that this bull market had seen a dream run of 10 years and a little over 6 months. With four forms over a decade, the market seems due for a correction.

Gann's forms, decade long bull move and ledge formation indicate a sell off in Gold is imminent

Gold long term bull market under threat

Ledge formation has ominous connotations for the price of gold

Subsequent to the high being established the gold price corrected sharply and since then has been consolidating to form a ledge like formation with support in the $1525 area (thick green horizontal line). As per Gann, the ledge is an extremely bearish formation and a breakdown from this level could result in a vertical fall.

Gann principles suggest that the gold price could fall very quickly to $1027-$1180 levels, if $1500 is breached

Furher Gann states that post completion of a bull market, the correction should be larger than the largest rally in the previous market and should achieve the price objective in faster time than it took to form the bullish move. The orange box explain this principle and provide a possible bearish target of $1180 to be achieved by September 2012. Further the number of days of consolidation from the all time high to the nearest top of July 2, 2012 is exactly 300 days which is an important natural number suggesting that a new trend may have initiated down.

If we apply the price equals time principle and adjust for scaling it is possible that the market could experience a fall of nearly $600 or a level of $1027. So the indicative bear market price broad range works out to $1027-$1180. Only time will tell. Remember, a break of 1500 is absolutely essential for this forecast to be valid.

Short term formations also seem to suggest topping nature and a possible acceleration in the decline in the price of gold.

Lower top formation, break of gann agles indicate gold price in under pressure

$1525-1540 is the last bastion of support for gold

Since the all time high, the market continues to make lower tops. It is often seen that after 4-5 lower tops once a major support is broken, price moves tend to get parabolic. The Gann angle drawn from the high of $1911 has served as an important supply line and barring for the false break out during the week starting February 21, 2012, the market has traded well below this gann angle line. Time measurement from the all time high to the nearest top of July 2, 2012 is exactly 300 days which is an important natural number suggesting that a new trend could have have initiated. Further if we apply the price equals time principle and adjust for scaling it is possible that the market could experience a fall of nearly $600

$1525-$1540 last line of defense for this bull market

As shown the thick green line of 1525-1540 zone is a major support. Also notice how the gann angle coming of the lows of January 29, has been providing support to the congestion in price since the recent low established on May 14, 2012. Incidently it is 49 days (square of 7) since then to the minor top of July 2, 2012. The price seems all set to break this gann angle with tomorrow’s trading leaving the $1525 -1540 range as the last hope for the bulls.

Any upside move beyond $1635 would extinguish this forecast and reinstate the bull count. So what is your view. Feel free to express your views and leave a comment.

Disclaimer: The views expressed in this article are entirely my own and do not reflect the views of my employer. This report is neither an offer nor a solicitation to purchase or sell securities. The information and views expressed herein are believed to be reliable, but no responsibility (or liability) is accepted for errors of fact or opinion. Writers and contributors may be trading in or have positions in the securities mentioned in their articles. Neither http://winningtrades1.com or myself accepts any liability arising out of the above information/articles.

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Vinit Bolinjkar Head of Research, Ventura Securities Ltd
Tel: | Mobile: 0 9730836363

http://winningtrades1.com

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Global OTC derivatives – Weapons of mass destruction (WMD) Infographic


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The time of global demise is not round the corner but waiting to burst over our heads like the heavens falling over you. Where are you Hercules when needed the most. 9 of the worlds largest banks have $228 trillion in exposure to OTC derivatives which are three times the size of the total global economy. Destruction is our destiny

DErivative exposure of ( largest global banks

Global banking destruction imminent???

For greater detail click this link

Disclaimer: The views expressed in this article are entirely my own and do not reflect the views of my employer. This report is neither an offer nor a solicitation to purchase or sell securities. The information and views expressed herein are believed to be reliable, but no responsibility (or liability) is accepted for errors of fact or opinion. Writers and contributors may be trading in or have positions in the securities mentioned in their articles. Neither https://winningtrades1.wordpress.com or myself accepts any liability arising out of the above information/articles.

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Vinit Bolinjkar Head of Research, Ventura Securities Ltd

Tel: | Mobile: 0 9730836363

http://winingtrades1.wordpress.com

http://in.linkedin.com/in/vinitbolinjkar

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It’s your gold stupid, that they are after !!!


In the small print of the new Greek deal lies a heavy penalty clause wherein Greece’s lenders will have the right to seize all of its 111 tonnes of the gold reserves. This Greek gold seizure is merely a dry run for the seizure of gold from the other countries that are in trouble – Portugal (382.5 t), Spain (281.6 t), France (2,435.4 t) and Italy (2,451.8 t). Meanwhile, Iran and Sudan are using their gold to buy food for their countrymen as nothing else will pay for it. Soon it would be the countries of India and China which would have to part with their gold if the time comes when OPEC refuses payments in any other form. A few months ago there were some press reports that said that EU finance ministers discussed the possibility of the ECB gaining control over the gold reserves of member nations.

Private gold confiscation just round the corner ?
So now we know what the Arab spring, Libya and all these skirmishes are about. And each passing event brings to light the severe, pathologically sick nature of the illuminati to enforce the NWO (new world order) and its devious plans. It’s your gold stupid, that they are after! And if you don’t shore up your reserves then the toilet fiat would not even serve wiping your behind with, as it would be all electronic money – binary numbers with value diminishing at the speed of light. If the central gold could be plundered in this fashion, then what stops these psychopaths from confiscating privately held gold – as Roosevelt did in 1935?

Emulate Hugo Chavez, Out with Buffet
Hugo Chavez is a visionary and his move to repatriate Venezuelan gold from vaults outside the homeland was far ahead of all. IMHO, the Greek seizure of their gold will lead to rapid repatriation of Gold back to home shores, à la Hugo movement which would be rapid and voluminous. Germany will notably be the mother of all repatriators as it empties the FED vaults.

About time that the hoax US gold reserves stand exposed; US Dollar to toilet paper
The sorry state of affairs at the ISDA to protect the interests of the bankers who pedaled insurance against sovereign debt will only lead to more money printing which will inadvertently cause currency induced cost push inflation leading to extreme price inflation. As debt implodes, so will the dollar and will bring to re-surge the commodities as the alternate currency, as each country will avoid the US Dollar like the plague. Here is where the US would stand exposed – naked to the world – as its questionable and unaudited gold reserves would be demanded that they be counted.

Ides of March to expose cracks in the global financial system
This would be the first crack for the international monetary system and while IMF as the banker of last resort would try to stitch up the fabric, would it be in time? Im sure not! But there is certainty that ITS ABOUT TIME THAT GOLD WENT BALLISTIC and rose in geometric proportions. 7 to 20 times current prices is what I expect considering the current levels of monetary stimulus, with significant upside risks in case the bankers get manic depressive and go berserk at the money presses.

Gold price rise is an eventual outcome
The date to watch out for is March 12, 2012 when the crucification starts with oil going ballistic, gold intraday volatility jumping and shrapnelling the shorts. Already the gold price in Japanese yen is hitting all time highs and signalling that gold prices are going to runaway against all currencies; notably the USD. Keep those gold holdings close to your chest.

Gold price in Yen

Gold breakout in Japanese yen

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Vinit Bolinjkar Head of Research, Ventura Securities Ltd

Tel: | Mobile: 0 9730836363

http://winingtrades1.wordpress.com

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