Subtle Signs Gold's Correction Is Over
Source: GoldSeek, Rick Ackerman (2/26/10)
". . .technical signs offer the most encouraging evidence of bullion's resurgence. . .since Comex gold reached $1,227.50."
The chart shows why we have turned optimistic after 10 weeks of carefully calculated skepticism. The red line tracks the price movement we had expected yesterday—a nasty selloff to at least $1,073.20. Instead, the futures got exactly halfway to the target and then reversed sharply (green line). When the rally subsequently exceeded two prior peaks on the hourly chart without a pullback, it showed it was not just a feint higher, but the beginning of a strong new trend.
According to the Hidden Pivot method, this is exactly what should occur when a corrective cycle ends. This correction began on December 3 from within four ticks of a $1,227.50 target that we had projected several weeks ahead of the turn. The correction until yesterday had traced out ABCD patterns that either reached or exceeded their D targets. However, this most recent ABCD downtrend failed to reach 'D,' reversing exactly halfway to the target. That is precisely what we expect a correction to do when the dominant trend is about to resume. We should like to see this pattern repeated fractally in minor timeframes for the next couple days before we sound the all-clear.