So, naturally, many players were quick to call gold's attempt to breakout over 1900 the day Russia invaded Ukraine a failed breakout.
Gold traded up to 1975 and ended up closing below the key 1920 level — the bull market high in 2011.
Gold spiked briefly above 1920 in August 2020 to over 2000 for a new ATH but failed in short order.
However, the current move has an 18 month wind behind its back. An 18 month consolidation.
Those who follow my analysis know that this is a key time frame being 540 days/degrees or a true square in time, a cube.
This is why I have been pointing to February 2022 as a major pivot for gold since late 2021.
It could have been a low, a high or an acceleration point.
It’s looking like an acceleration point
Simply put, a true square or 3 dimensional square consists of 6 sides with 6 ninety degree angles.
90 X 6 is 540 degrees.
I have read most everything WD Gann has written and I never saw him mention the word “cube.”
He talks about squares and square-outs continuously, but never do I remember the word cube.
There is a saying I like to use about price action — the second mouse gets the cheese.
In other words, the first mouse or move often gets the squeeze while the second mouse gets the cheese.
Buyers often chase the initial move and have buyer's remorse as the item comes back in.
Then the second move comes and is often the genuine directional move — the real deal that is watched from the sidelines by those that got burned on the initial impulse.
In sum, the next time GLD pushes over 183, last week's reversal high, it looks like it could be a strong example of the second mouse getting the cheese.
Moreover, in the big picture, clearing the August 2020 breakout over the $1920 peak could be a big second mouse.
183, where GLD was rejected from the opening bell last week, is 180 degrees up from the 18 month consolidation low of 157.
Another 90 degree decrement higher is 197.
A full 360 degrees up from 157 gives 211.
Interestingly, 157 and 183 both align, vibrate off February where this impulsive rally started.
Opposite February is August where GLD scored its ATH in 2020.
Red 157 and 211
Blue 183
You can’t make this stuff up.
Yesterday many miners gapped up and grinded higher clearing last weeks reversal.
Examples include GDXJ, WPM, PAAS and GLDG.
Gold is hated, but it’s getting some love, fast.
Legendary investor/trader Bernard Baruch said that “Successful speculation is about anticipating the anticipators.”
Want to take your trading to the next level by anticipating turning points and pivot highs and lows?
Well the Square of 9 Wheel of Time & Price is the best trading tool on the planet. Period.
The Market
Below is a weekly SPX from the early 2018 flash crash, which perpetuated two years of a volatility pendulum.
A weekly Ghost Line from the 2018 peaks… January & September defines the pivot high prior to the first correction off the March 2020 crash low (3500-3600).
The chart also shows a weekly trend channel created by paralleling a TL off the March 2020 low with the tops line from September 2020 through early Jan 2022.
Notice where the bottom rail of this trend channel intersects with the aforesaid Ghost Line.
THIS INTERSECTION DEFINES THE JANUARY 2022 ALL-TIME HIGH.
The implication/indication is that the SPX should drop to the low 4000 region.
If so, it may undercut/wash out the trend line on a drop to the Ghost Line at 3800.
The bull case: the SPX presents two large weekly Bottom Tails… a third drive to a new swing low that holds the 4000 region could perpetuate a rally phase.
If so, the structure and nature of that phase will tell us much about the next few years.
Below 3800 region opens the door to an Eiffel Tower pattern, the pre-Covid crash highs around 3500-3660 where prior resistance should act as new support.
In sum, yields are crashing, oil is surging, gold is breaking out, stocks are all over the map intraday and from one day to the next.
While instability reigns, expect the unexpected… especially as VXX is on the verge of a triple top breakout (Rule of 4) in league with a Selling Climax with genuine panic that hasn’t been seen yet.
