GEOMETRY OF GOLD: 26.01.2021

In my previous Geometry write-up I mentioned that this week I would be moderately bearish on gold. So far, the stock follows the expectations and today I would like to focus more on the technical side and the moving averages in particular: 8 EMA – brown, 20 EMA – green, 50 MA – yellow, 100 MA – purple, 200 MA – red on all charts.

As you can see on the Daily chart, in the first blue rectangle the 8 EMA bounced off the 200 MA rather sharply (stick save). In the second rectangle it was not the case. The 8 EMA not only crossed and back tested the 200 MA, it also pulled the 20 EMA and 50 MA to cross the 200 MA, yesterday and today respectively. Not a healthy sign.
A similar picture can be seen on the 4HR chart – all significant moving averages are pointing towards a bearish cross in the next couple of days. Note that on all charts above the price is moving below the 200 MA.

On the Daily mid term chart I made a little change by adjusting the possible channel for wave (C) based on several points produced in the last couple of days. The channel is still preliminary and could be adjusted further once the wave 3 is complete. I continue to be moderately bearish during this week. However, the build-up in the last two days could trigger a great sell-off (minus one or more percent) tomorrow or on Thursday.

And, by the way, the GDX is not doing well either.

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