GCZ22 – December Gold (Last:1782.70)

I said I’d loosen up on gold if the December contract popped through three ‘external’ peaks,  the highest of which lies at 1785.80. It very nearly succeeded, falling just 1.30 shy of my benchmark when the clock ran out on buyers Friday. However, I remain distrustful of gold’s rallies nonetheless and probably would not have become less skeptical even if this rally had met my bullish criterion.  Beginning with the July 21 bottom, it has been a shaky, ratcheting affair all the way up. The fact that it couldn’t muster the extra inch it would have taken to surpass the small-ish peak at 1785.50 has left my mild skepticism intact. Accordingly, I’ve used two modest patterns to project unambitious targets. The first lies at 1788.90, just $6 above, and comes from a reverse pattern begun with a low near 1800 in early May. The second, at 1804.60, is derived from a larger rABC tracing back to a point ‘a’ low made in February. I’ll be watching closely to see how much resistance they put up, but either can be shorted using ‘camouflage’, especially if you’ve been long on the way up.