Global Markets Crash - Is Gold Next?

The long term secular bull market is still intact. However, Gold may be headed for at least the mid-channel and possibly the bottom of the channel ...In other words, Gold may be entering a corrective phase soon.

Gold Miners Leading Gold on Renko Charts

• The miners have reversed on the weekly Renko charts before Gold.

How to use Renko Charts

You always want to trade with the major trend - the trend is your friend. Renko charts differ from traditional price charts because they ignore the passage of time and focus on price action and trend. Other types of charts with a similar perspective are Point and Figure, Three Line Break, and Kagi charts.If you want to learn more about these, I recommend the following book: Technical Analysis from A to Z, 2nd Edition


Let's take a look at some $GOLD Renko charts:

Use the weekly chart to filter trades using the daily chart to ensure you are trading with (not against) the longer term trend.

Let's take a look at $XAU and $HUI:

Daily Renke Charts

Now, let's step way back and see the big picture for GOLD using a monthly Renko chart:

The long term trend is still  secure. Use the weekly charts to identify the dips and daily charts to time the trade execution.

Revisiting the DOW:GOLD Ratio

If you are a GOLD Bug, then you know who Rob Mcwen is. You  then also know that his favorite chart is a chart of the DOW:GOLD ratio. During any of his presentations, he pulls out this chart to state his case why you should be investing in GOLD. Let's take a look 3 different time frames:

The daily chart is showing a 50% Fibonacci retracement followed by a breakout.

On the weekly chart, the Bollinger Bands are tightening and the ratio is approaching the long term down trend line. Decision point is around the corner ...

Definitely a decision point is right around the corner. However, the charts at this point are favoring a resumption of the uptrend that started in March 2009. Inflation? Reflation?

Let's take a step back ...

Step way back and take a look at the last 200 years - DOW:GOLD Ratio