My original thesis on the Gold complex was based purely on the very direct intra-market 'technical' correlation between GG (
Goldcorp NYSE) and Gold (Futures (Feb)) - nothing fundamental. Referencing the daily-overlay (line) chart from that post demonstrates a spatial gap between the two products. Gold equities have been unable to take a 'bid' and have thus lagged the metal, which lead me to objectively state that either Gold must come down or GG must move higher to reconcile the discrepancy - my assumption at the time was that Gold may stay bid, but the gold stocks have looked too weak to play catchup. So, I've had to flip my original insight and go with the market and my system - sticking with the plan. Meanwhile, gold-equities have continued lower, and today we can see the Gold liquidation event - generating the
Momentum Sell Signal at 1674.50 (
Trade 59) This signal has offset '
Trade 58' Long, entered at 1704.50, Nov 28th (for a -$29.5 loss: To compute $P/L = 100 x 29.5 x # contracts).
I've posted 2 charts below; the first is the intraday Gold, showing the move away from the '2DNR' pattern - (Narrowest 2 trading days of the previous 20 days) an implied contraction pattern, while hovering the structurally important Weekly (Blue Line - 1690) and Monthly support (Brown Line 1687), respectively. Any price acceptance back 'above' these structural boundaries would negate the trade. So my onstop sits at 1700, above the 3-day regression, with an exit rule if today's pit session closes > 1687 in the Feb contract.
Below, I've attached the latest day chart of Feb Gold, showing the technical breakdown < 1680. Notice how Gold has hovered at the weekly channel lows (the low end of the weekly price channel in blue). We now see 3 Momentum Signals delivered (red arrows), with the most recent as a result of today's price action.
