Some person once said somemthing like, “Shoot for the Moon, and if you miss, grab a star on your way down.” One of the biggest mistakes that I think investors, technical analysists, and chartists make is getting too much tunnel vision in terms of short-term charts, short-term price, and short-term ideas. Jim Sinclair once said that, “To make big money, one must take big risk.” In doing so, he was suggesting that one should take big risk at times, but with a SMALL amount of money- NOT betting the farm. Personally, I think that today is one of those times in the Gold, Silver, and Gold/ Silver Stocks. Of course, the amount of “risk you take” is really only a function of how well you have done your homework, most of the time.[Please make sure that you read the disclaimer at the bottom of this article. I am in no way giving you any investing advice of any kind, and I am not licensed to do so!]
People usually like to look for cup formations on charts- probably because a cup formation is easy to see, easy to understand, and makes sense in terms of a future price target. Yet, things that are easy to see are often not particularly rewarding.
Most people look for all cup formations to form in a horizontal fashion on a chart. Yet, price charts are very dynamic since “price is created by the perception of investors toward the fundamentals.” Just look at the Deflation Scare into late 2008, a term that I first coined in 2007 based off the late 70’s fractal charts. The huge expected waterfall decline in price played out across the board, yet turned out to be a dud once people realized that the Fed was not done aggressively printing Dollars. “Price movements”are heavily influenced by human fear and greed! For instance, investors sold Gold down over the last year, even though the Fed printed up over $1.3 Trillion Dollars. It is going to be interesting to see the fear of those investors continue to move toward greed on the Gold Chart, as the market suddenly plays catch-up in terms of devaluing the US Dollar. Watch the potential for Gold to continue this 5th wave romp to new highs, and higher, likely with only short-term and minor chop-type corrections. Watch investors “chase the price of Gold, higher.” It will all be about “fear turning to greed.” Then, we will eventually meet another intermediate-term top for Gold.
Since “price” is founded on fundamentals, but magnified by the perception of investors toward those fundamentals, fear and greed are the two main “magnifiers of price.” Think about the stock price of Facebook, or remember back to the days of Beanie Babies.”
I have done a lot of work over the last 10 years, or so, using “Angled support and resitance lines” on charts. In many cases angled lines appear to be the controling lines on charts- especially on the strongest charts. Gann used mathematical formulas to derive support and resistance that changed from day to day- angled support and resistance. In reality, we see cup formations that are horizontal, tipped to the left, or tipped to the right; and the orientation of each cup formation tells us a lot. Each cup orientation has huge ramifications for price, depending on the pricing environment.
Today, we are going to look at the Historic SuperBull Cup for Gold over a long period of time. The SuperBull Gold Cup is heavily left-angled- the type of cup that screams, “strength, Strength, STRENGTH!” On this chart, I have drawn the “controlling lines” in blue with the Cup top off of the 1980 Gold high in thick dotted GREEN. We can see the double blue lines at the base of the huge cup where big smart money started to heavily accumulate Gold to create the bottom. This is an arithmetic chart so remember the concept of increasing runs of Gold at higher slopes we have shown in a previous article. The runs tend to be longer in price and shorter in time as the Gold Bull runs on, as we have shown in the previous article on Gold parabolic price formation.
At the very top of the chart is the potential SuperBull Gold Cup target up into the high $3,000s. That cup target is not the final cup target for SuperGold Bull for this historic run by any means, though, just an intermediate-term target along the yellow brick road, in terms of Gold’s potential.
Since we have reached historic all-time highs, there is very little horizontal resistance left on the chart. A break of the historic cup will leave very little LT angled historic chart resistance. THAT is where the final huge moves will START come for this Gold SuperBull! Be prepared to fasten your seatbelts, going forward.
BIG PICTURE GOLD- PART 1– THE ONLY GOLD CHART THE LT INVESTOR NEEDS
BIG PICTURE GOLD- PART II– GOLD BULL PARABOLIC GROWTH
BIG PICTURE GOLD PART III- GOLD BULL LOG CHANNEL
BIG PICTURE GOLD- PART IV- SUPERBULL GOLD RIDES THE WAVES OF THE MOVING AVERAGE ENVELOPE
A much more extensive writing on Gold and Gold charts, where Gold might be going, and when; is linked, below, to Jim Sinclair’s site. You will have to scroll about half way down the page, but the article is there in its entirety.
As we go further in this series on “Big Picture Gold”, we will eventually merge our thoughts with those currently being added in my series on “Price Versus Value” in the series on “Dow Stock Crash.” I’ll post the links to Part I and Part II, below, so that you can start to become familiar with the concepts of “price versus value.”
My article on THE SILVER ROCKET is linked, below
The Gold version.
And finally, if you need a break from all of the negativity, you might want to take time out to read the following story to a younger loved one in the family.
Goldrunner maintains a subscription site that covers Gold, Silver, and the Gold and Silver Stocks that can be found at;
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For the moment,
Please understand that the above is just the opinion of a small fish in a large sea. None of the above is intended as investment advice, but merely an opinion of the potential of what might be. Simply put: The above is a matter of opinion and is not intended as investment advice. Information and analysis above are derived from sources and utilizing methods believed reliable, but we cannot accept responsibility for any trading losses you may incur as a result of this analysis. Comments within the text should not be construed as specific recommendations to buy or sell securities. Individuals should consult with their broker and personal financial advisors before engaging in any trading activities. Do your own due diligence regarding personal investment decisions. In the interest of full disclosure, GOLDRUNNER is personally invested in the Precious Metals sector including various Precious Metals and other individual stocks. GOLDRUNNER reserves the right to modify or eliminate any or all positions at any point in time.
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