There’s gold in them thar charts!

Yes, indeed. gold continues its relentless climb towards my major $1400 target.  We managed to get on board close to the $1200 level and in recent days, the move has turned exponential.  Gratifyingly, there have been no panicky short squeeze leaps with large gaps, which was a feature of previous bull runs as the gold bugs went wild.

This time, I sense that traders are only gradually falling back in love with gold again.  And the army of gold bears are slowly throwing in the towel. This is very constructive for the rally, and gives hope that $1400 is within reach.  But there is a fly in the ointment – as I alluded to last time.  The big players are now emerging with the same forecast as your truly!  Maybe they are reading my blog.  However, if it is a battle between Goldman (who predicts sub-$1000) and myself, I will gladly take on that challenge.

As it happens, I believe we will see sub-$1000, but not yet.  We must first gather a substantial herd to the bullish cause before the market can resume its downtrend.  Maybe that will happen at $1400.  But first, the market must negotiate my Fibonacci levels and tramlines.  Here they are:

Now we have reached the Fibonacci 50% retrace and heading towards my third tramline.  And where it meets the Fibonacci 62% level is my next major target.  If the market does not at least pause here at the critical 50% level, then my target will be reached in short order.

Meanwhile, I am very much enjoying this ride.

MARCH T-BONDS

I took a nice little profit from the short side from the 134 area this week and looking now at a long trade:

The rally will be a C wave which should end in the 135 – 136 area, and when it does, the mother of all bond sell-offs will begin.  I really want to be short for this spectacle.  Remember, the long-term trend is down, but the current overweight negative sentiment towards Treasuries must be driven out first (see similar picture in gold).