So what does this mess of fibs suggests? Well let me put it this way. I am a subscriber to several sites. Many have useful information, priceless in some cases for ironing out POSSIBLE outcomes. Key work being possible and they most all read like this, it is possible that it goes up or its possible that it goes down but are hesitant to make calls. I can tell you absolutely what the fibs suggest here. I get asked sometimes how this fits in to the Elliot wave count. To be honest I know little about EW and its very subjective but always works once you can get the count after its all over. Fibs however do work. They are not subjective. They require no interpretation and key intersections of long term fibs are always the biggest number on the board and when we get the chance to get close to them they become powerful magnets as the machines gravitate to them. So with that in mind here is what is likely to happen to gold and the set up is just about perfect in the fib world. First of all 1770.50 is in the bag. Gonna happen. May as well write it down. Look for it to hang around there on and off with spill slightly over that level and then go back and retest 1714 to build support again for the eventual blast up. From there the machines will crawl around that level and with a blast take us up to the biggest fib on the board, 1784.12. Write that one down please if you have ever written down a number in your life. Its the set up for the dream fib trade and I mean dream as in dream money. Especially if the following happens.
Gold charts are generally viewed on time charts. As you know I am not a fan of time charts. Volume charts mean so much more. A time bar may have 20 contracts or 1,000 contracts and which time bar means more? Volume bars evens things out. All bars mean the same. So with gold what do the volume bars mean? Gold has a tendency to make dramatic turns between 950,000 and 1,000,000 contracts traded. Some of the most drastic turns in gold happen in this range. So here is the dream setup. If, more likely WHEN we get to 1784.12 look for one thing. Does that number coincide with the previous 10, 100k bars being up off of a low of some kind. In other words did it break out of a range of the 1714 or 1770.50 to GET THERE. If it has then you have your set up. Plain and simple and unless some underlying news story blasts it higher the chess board is set up perfectly at least in the fib world. Its a short. Will it be easy no. Gold will look like its going to the moon but its not. At least not yet. The reversal off that 950,000-1,000,000 contracts if its even close is going to be a rip your face off move. It is 75% of the time and I like those odds. Gold is easier to predict than most. Where does it go off that move. Well as the chart suggest its going to be a hard ride down but do not look at the ride down in TIME it will give you a head fake which will cost you money. Look at it in 50k or 100k volume bars. First pause on the way down of course 1770.50 A head fake move and more will buy back in but here is where the dream trade really takes hold. The next elevator down is is to (gulp), 1714 and once again do not look at time look at volume bars. That level will fall hard the hardest of the fibs. It will be air. Look for a little head fake there again as the computers program buying comes back in but after that wears thin we will eventually go right to the 1692 having traded 1,000,000 shares to get there after the break down. There may be a touch of spill on all of these moves but do not let that keep you out of the trade. 1692 will be a short term low with clearly a move back to 1714 in the bag but the real trade here is that short there at 1784.12, all the rest of it is more like scalps between the fibs. 75% odds of a 92 point swing in gold over 1,000,000 contracts. I like the risk reward on that one. But again I caution you, when the slide starts do NOT look at that chart in time intervals. Time will say buy volume bars will say we are not there yet so avoid the prospect of buying again until you have seen 1,000,000 contracts traded between 1784.12 and 1692.