By: Jeff Cooper
Hit and Run Morning Stock Report: February 23, 2023
Need help? Check out the Hit and Run Success Guide.
GLD in the Wheelhouse
Gold rallied from 1613 to the mid-1900’s from early November to early February.
That’s a textbook 90 degrees in time.
Long-time readers are familiar with Hit and Run’s use of the geometry of Time and Price in keeping with the methods of legendary trader, W.D Gann.
Gold’s 90 degree/day rally is a text book example
Moreover, if we look at the price action in GLD, it telegraphed both the low and the high.
GLD left a Combo buy signal at the November low---a Gilligan and a Soup Nazi buy patterns.
At the high, GLD left a large-range Soup Nazi sell signal and Train Tracks.
A Gilligan buy signal (from my books Hit and Run Trading) is a gap down to a new 60 day low with a close at/near session highs.
A Soup Nazi buy is a new 20 day low that reverses back through the low of at least 4 days prior within the 20 day lookback.
As below, so above. A mirror image fold-back.
Gold/GLD had a momentous move in that 90 day stretch. GLD moved from 150 to 182.
Subsequently, we’ve had a decline.
However, given the nature of the slope of the prior rally, the presumption is this decline is a corrective versus impulsive decline…ie, a bullish pullback.
Slope refers to sharp price movement over a short time period…ie, momentum.
GLD turned its 3 Week Chart down last week and bounced and is currently testing last week’s lows.
If indeed, this decline is bullish it should strike a low soon in terms of time and price.
One factor underpinning that assumption is that November 3rd, the low, vibrates off 169 ---where GLD is currently trading.
Consequently we may have a Time/Price square-out on the table.
What that means simply is that Time points to Price and Price points to Time.
“There is a definite relation between price and time.”
Checking an hourly GLD shows 3 drives to a possible low and a double bottom.
Breakage above 170.50 triggers an Angular Hourly Rule of 4 Breakout opening the door to a test of the declining 50 hour moving average.
If the 20 hour (red) crosses back above the 50 hour (blue) it opens the door to a push to Phil D. Gap.