Gold

[Guest Steve Cook]

Found this on the Kitko site. The best way to view it is to left-click on the link to the picture and allow Windows to open it. Once opened, then right-click it and choose "save picture as" from the drop down menu. Once it has been saved to your machine, then double-click it open from there.

The reason I have suggested saving it locally and then re-opening it from there is because when I opened in in HPC, the image was far too grainy and the writing was to small to read. However, the image is, in fact, a high enough resolution to see it properly. This only happens, though, when you save it locally. Don't know why.

The image is a chart showing trend lines for gold over the last year. It also shows support and resistance lines. Very interesting. It seems to show that the current price is quite shakey indeed. I may have read it wrong, Any further advice on it would be welcome.

Steve

Edited February 3, 2008 by Steve Cook

[DisplayNameChanged]

Found this on the Kitko site. The best way to view it is to left-click on the link to the picture and allow Windows to open it. Once opened, then right-click it and choose "save picture as" from the drop down menu. Once it has been saved to your machine, then double-click it open from there.

The reason I have suggested saving it locally and then re-opening it from there is because when I opened in in HPC, the image was far too grainy and the writing was to small to read. However, the image is, in fact, a high enough resolution to see it properly. This only happens, though, when you save it locally. Don't know why.

The image is a chart showing trend lines for gold over the last year. It also shows support and resistance lines. Very interesting. It seems to show that the current price is quite shakey indeed. I may have read it wrong, Any further advice on it would be welcome.

Steve

The picture is being resized to fit into the window explorer window, which is why you cannot read the writing.

On vista Internet Explorer you can simply click the picture to zoom in and everything becomes clear.

(Saving it and opening the saved version probably makes a different application open the picture)

Anyway I am yet to be convinced that studying charts is of any benefit to making investment discisions.

[Guest Steve Cook]

The picture is being resized to fit into the window explorer window, which is why you cannot read the writing.

On vista Internet Explorer you can simply click the picture to zoom in and everything becomes clear.

(Saving it and opening the saved version probably makes a different application open the picture)

Anyway I am yet to be convinced that studying charts is of any benefit to making investment discisions.

Seriously? So you just buy or sell on the basis of how you are feeling at the time?

If, on the other hand you are using your intellect, then surely a chart is merely the graphical summary representation of a large data set. This allows the viewer of said chart to make informed choices about large data sets. To suggest that you don't value charts is the same as saying that you don't value data summaries. I can only assume, then, that you have a brain the size of a house since that is what you would need to handle such data sets raw.

Steve

Edited February 3, 2008 by Steve Cook

[Loggy]

Found this on the Kitko site. The best way to view it is to left-click on the link to the picture and allow Windows to open it. Once opened, then right-click it and choose "save picture as" from the drop down menu. Once it has been saved to your machine, then double-click it open from there..................

Steve

Or for XP , ( and later IE's i think ) go to tools, (top left screen usually) internet options , far right hand side tab- advanced, scroll down to multimedia and unclick Enable Automatic Image Resizing.

I find it really annoying, just another unwanted interference from microsore.

Edited February 3, 2008 by Loggy

[Guest Steve Cook]

Or for XP , ( and later IE's i think ) go to tools, (top left screen usually) internet options , far right hand side tab- advanced, scroll down to multimedia and unclick Enable Automatic Image Resizing.

I find it really annoying, just another unwanted interference from microsore.

I agree, MS is generally a pain in the ****. Thanks for the info regarding auto resizing

Steve

[Layman]

Seriously? So you just buy or sell on the basis of how you are feeling at the time?

If, on the other hand you are using your intellect, then surely a chart is merely the graphical summary representation of a large data set.

Well the way I see it is.... a chart is used for Technical Analysis ("TA" in City speak). OK, Technical Analysis looks at trends in the buying and selling of the product and so-called "support" and a bunch of other stuff I don't care to understand, and aims to predict what will happen next based on this info. It completely fails to look at why people are buying and selling - there's nothing in the chart to take account of US policy, rate cuts, employment figures, stock market moves, etc, etc. To me, the main reason I'm investing in gold is because of my views, knowledge and opinion on other parts of the global economy.

As has been discussed earlier in this thread (I think), TA sometimes works because if everyone uses it and believes in the same voodoo, it'll often come true. e.g. the chart says "buy" so everyone buys, the chart says "sell" so everyone sells. But it completely fails to take into account the fundamentals behind the product.

BTW, your chart seems (I think) to miss the significant (but not major IMHO) downward correction on Friday.

Shifting topic slightly

An "expert" on CNBC Squawkbox Europe on Friday morning was stating Gold was now a "sell" because, due to ETFs, there is now more gold held by private investors and speculators than there is held by central banks. This is the first time in history this has occured and he reasoned that it showed the price was due to speculation and due a correction.

Discuss.

Edited February 3, 2008 by Bobsta

[DisplayNameChanged]

Seriously? So you just buy or sell on the basis of how you are feeling at the time?

If, on the other hand you are using your intellect, then surely a chart is merely the graphical summary representation of a large data set. This allows the viewer of said chart to make informed choices about large data sets. To say that you don't value charts is the same as saying that you don't value data summaries. I can only assume, then, that you have a brain the size of a house since that is what you would need to handle such data sets raw.

Steve

Yes seriously. Well ok i will climb down a bit, not all charts are pointless, i like looking at some.

It is daily price history charts I was thinking about. I was coming from looking at stock price charts. There is daily random walk noise on the price of shares and trying to see trends through the noise is IMHO a waste of time.

OK I will not go on about share prices, we are on the gold thread, so gold price charts:-

what would a gold price chart tell me if gold fell $100 on monday, or fell $1 a day for the next 100 days?

That I should sell, hold or buy?

To answer your question, yes I think I do buy and sell stuff on how I am feeling at the time. Looking at price history charts gives me the feeling of wanting to do something all the time, I read too much into every movement. Which is why I don't study them, much.

Ok to answer your other point - charts are a good way seeing the raw data. The point I am wanting to make is does the data/chart actually mean anything?

The price of houses and average earnings chart - i say yes. The daily fluctuations of the price of gold - i say no.

[Guest Steve Cook]

Well the way I see it is.... a chart is used for Technical Analysis ("TA" in City speak). OK, Technical Analysis looks at trends in the buying and selling of the product and so-called "support" and a bunch of other stuff I don't care to understand, and aims to predict what will happen next based on this info. It completely fails to look at why people are buying and selling - there's nothing in the chart to take account of US policy, rate cuts, employment figures, stock market moves, etc, etc. To me, the main reason I'm investing in gold is because of my views, knowledge and opinion on other parts of the global economy.

As has been discussed earlier in this thread (I think), TA sometimes works because if everyone uses it and believes in the same voodoo, it'll often come true. e.g. the chart says "buy" so everyone buys, the chart says "sell" so everyone sells. But it completely fails to take into account the fundamentals behind the product.

BTW, your chart seems (I think) to miss the significant (but not major IMHO) downward correction on Friday.

Shifting topic slightly

An "expert" on CNBC Squawkbox Europe on Friday morning was stating Gold was now a "sell" because, due to ETFs, there is now more gold held by private investors and speculators than there is held by central banks. This is the first time in history this has occured and he reasoned that it showed the price was due to speculation and due a correction.

Discuss.

It doesn't fail to look at why people are buying and selling because that is not the function of a chart of the type you have described (though I can imagine how some charts might attempt to at least partially fulfill that function). Rather, it is summarizing the patterns of buying and selling. This provides two useful functions. Firstly, there are certain market behaviors that tend to occur sufficiently frequently as to be called patterns. Such patterns, independently of the real world, have a kind of reality of their own and will follow certain reasonably predictable trajectories. Charts are a way of illuminating such patterns. Secondly, whilst charts as you have described them do not give direct evidence of what is motivating buyers or sellers, they do show changes (both directionally and magnitudinally) in the market. It is then up to the user of such charts to try and match the observed market behavior with "real World" events. I am not suggesting that charts are to be used in the absence of real world observation. That would be silly. However, I think it equally silly to suggest that they are some kind of voodoo.

Regarding whether the chart misses the Friday correction. I think you are correct. However, that being the case, the fact that the chart indicates that the market was significantly overbought and suggested strongly that a correction downward was imminent, doesn't that rather justify it's usefulness given Friday's subsequent significant movement?

Steve

Edited February 3, 2008 by Steve Cook

[uro_who]

I have to say that for me TA does work. In fact it has increased my high risk savings account by 50% in the last month. It enables me to know when it's too risky to get involved and when the chance of being correct is higher. It helps me to understand when to buy and when to exit, without that its all hope, greed and fear! It does enable you to understand the feelings of the market. You do need however to understand not just the prices but candlesticks, RSI, MACD amongst other things. I always trade with knowledge of the news but the market much more often follows the TA than the news, simply using todays news to justify todays moves. 70% of professional traders use TA so if you don't understand the language of the prices you are at risk of getting burnt.

My TA analysis of Fridays happenings is that there is nervousness about the price of gold. On the weekly and daily charts it was mildly overbought with an RSI of 68-70%. Previous big corrections have been at the 85% level. Fridays drop held where I would have predicted at 905'ish. On the 15th of January (daily chart) there was a bearish engulfing pattern. This is the most recent notable pair on the chart. The price came to this level and towards closed became a descending triangle on the intraday charts.

What is the next move? Short term descending triangles breakout to the positive and negative exactly split, so no help there except to watch very carefully on Sunday evening as that is likely to mark direction of a fairly sizeable move (and the far eastern markets have mostly dropped the price overnight in recent trading). The weekly chart incorporating Fridays prices shows a shooting star. A possible reversal but not confirmed unless this weeks price pushes a good way down the price from two weeks ago. If that happens we will probably be in for 4-5 weeks of price declines.

I'm a rank amateur but Trading Central's analysis is a week of consolidation followed by a push onto $970/1010.

From my point of view the 'dramatic' move on Friday in GBP terms removed only 1.4% of the pound price. Not exactly earth shattering, much of the reduction was dollar strength rather than gold weakness. I expect an interest rate cut in Feb which will probably add a further 5% to the Gold/GBP equation.

For the medium term it strikes me that when the worlds largest economy has interest rates lower than inflation, the worlds second largest trading area has increasing problems with inflation and all of the BRIC countries are seeing marked inflation the gold price is going to at least $1000 this year.

I'm keeping a steady nerve but have a deal ticket open ready to short against my physical holdings if things look to get temporarily choppy!

[Layman]

It doesn't fail to look at why people are buying and selling because that is not the function of a chart of the type you have described

Hi Steve... Sorry, perhaps some mis-phrasing on my part. I wasn't criticising your particular chart. I was saying that (by definition) a TA chart doesn't look at why people are buying and selling. In my mind that means it "fails" to take this into account - but I agree it is not its aim.

However, I think it equally silly to suggest that they are some kind of voodoo.

Perhaps voodoo's a bit strong. But taking house prices as an example, you could produce a chart of house prices and it would say "sell, sell, sell" - but by not taking into account externalities you could end up calling the top or bottom at completely the wrong time. I don't subscribe to the view that every market is traded by computers using algorithmic trading and folks using charts. As such TA can never be anywhere near 100% accurate.

BTW, I'm not the only one who doesn't particularly believe in charts... See: previous posts in this thread

Regarding whether the chart misses the Friday correction. I think you are correct. However, that being the case, the fact that the chart indicates that the market was significantly overbought and suggested strongly that a correction downward was imminent, doesn't that rather justify it's usefulness given Friday's subsequent significant movement?

The voodoo clearly worked! ... this time...

Speaking of charts, I note someone posted this silver charting article in the news blog today... which I admit I found simple enough to understand and potentially consider to have some merit.

[DisplayNameChanged]

Shifting topic slightly

An "expert" on CNBC Squawkbox Europe on Friday morning was stating Gold was now a "sell" because, due to ETFs, there is now more gold held by private investors and speculators than there is held by central banks. This is the first time in history this has occured and he reasoned that it showed the price was due to speculation and due a correction.

Discuss.

I like your reply about TA better than my own.

Shifting topic slightly

More gold available to private investors and the price goes up? More supply and even more demand?

Did he say which way the correction was going to be?

[Guest Steve Cook]

Hi Steve... Sorry, perhaps some mis-phrasing on my part. I wasn't criticising your particular chart. I was saying that (by definition) a TA chart doesn't look at why people are buying and selling. In my mind that means it "fails" to take this into account - but I agree it is not its aim.

Perhaps voodoo's a bit strong. But taking house prices as an example, you could produce a chart of house prices and it would say "sell, sell, sell" - but by not taking into account externalities you could end up calling the top or bottom at completely the wrong time. I don't subscribe to the view that every market is traded by computers using algorithmic trading and folks using charts. As such TA can never be anywhere near 100% accurate.

BTW, I'm not the only one who doesn't particularly believe in charts... See: previous posts in this thread

The voodoo clearly worked! ... this time...

Speaking of charts, I note someone posted this silver charting article in the news blog today... which I admit I found simple enough to understand and potentially consider to have some merit.

I take on board your point on externalities Bobsta

Steve

[Layman]

I have to say that for me TA does work. In fact it has increased my high risk savings account by 50% in the last month. It enables me to know when it's too risky to get involved and when the chance of being correct is higher. It helps me to understand when to buy and when to exit, without that its all hope, greed and fear! It does enable you to understand the feelings of the market. You do need however to understand not just the prices but candlesticks, RSI, MACD amongst other things. 70% of professional traders use TA so if you don't understand the language of the prices you are at risk of getting burnt.

OK, I hate narrow-minded bigotry ... and maybe I'm just dismissing TA because I don't fully understand it.

So, convert me!

Any pointers to some decent tutuorials? I'm not thick - but I'm crap at just reading stuff - so a decent tutorial would be far better. Thanks.

[uro_who]

Of course TA isn't 100% accurate.

70% depending on the pattern etc is more realistic. But be choosy about when to enter, take that 70% and have a fierce risk management plan to control losses and you can steadily move ahead.

Its worth looking at http://thepatternsite.com by Bulkowski. He's spent a lot of energy looking at the predictive abilities of chart patterns and candlesticks. He's quantified the success rates. Many of the 'classics' are 50/50 and therefore useless but plenty are in the 70% range and some in the 80%. Not much in life has that degree of certainty.

Bobsta - another place to look is Technical Analysis for dummies. cheap and a good intro.

Steve Nison wrote a good book on candlesticks, worth looking at. You'd imagine that it's flash in the pan but it was designed in 1700's Japan and made the initiator of the technique one of the richest men in the country. When all is said and done its just a way of measuring human behaviour and sentiment. We know the power of that on this site more than many others. It simply doesn't matter what the fundamentals say. Houses have been over priced since 2003 but it hasn't really helped. All that matters is the price movement. I used the my understanding of economics to trade at the end of last year and lost 30% of my high risk capital. Stopped trading, spent 2 months reading about TA, candles etc and re-entered and currently its working for me although you never know whats around the corner!

Edited February 3, 2008 by uro_who

[Layman]

I like your reply about TA better than my own.

Thanks. <blushes>

Shifting topic slightly

More gold available to private investors and the price goes up? More supply and even more demand?

Did he say which way the correction was going to be?

His point was that there's been heavy investment in ETFs. Thus ETFs hold a lot of gold (as they have to). By his measurements ETFs and private investors now hold more gold than CBs. As such it's "in the wrong hands" and is in danger of collapse.

I didn't pay a huge amount of attention, I was in a hotel near Geneva preparing for a meeting... but it was the first time I'd heard this "fact" that more bullion was outside CBs than inside.

[uro_who]

Thanks. <blushes>

His point was that there's been heavy investment in ETFs. Thus ETFs hold a lot of gold (as they have to). By his measurements ETFs and private investors now hold more gold than CBs. As such it's "in the wrong hands" and is in danger of collapse.

I didn't pay a huge amount of attention, I was in a hotel near Geneva preparing for a meeting... but it was the first time I'd heard this "fact" that more bullion was outside CBs than inside.

It doesn't have to be collapse, it implies a risk of greater volatility up or down which is what we are seeing.

Every drip of news about inflation is likely to prompt more and more people to buy into gold.

Sorry bobsta as a bit of bad form I answered your post by editing my prior one. I've copied it below.

Bobsta - another place to look is Technical Analysis for dummies. cheap and a good intro.

Steve Nison wrote a good book on candlesticks, worth looking at. You'd imagine that it's flash in the pan but it was designed in 1700's Japan and made the initiator of the technique one of the richest men in the country. When all is said and done its just a way of measuring human behaviour and sentiment. We know the power of that on this site more than many others. It simply doesn't matter what the fundamentals say. Houses have been over priced since 2003 but it hasn't really helped. All that matters is the price movement. I used the my understanding of economics to trade at the end of last year and lost 30% of my high risk capital. Stopped trading, spent 2 months reading about TA, candles etc and re-entered and currently its working for me although you never know whats around the corner!

[Guest Steve Cook]

I have to say that for me TA does work. In fact it has increased my high risk savings account by 50% in the last month. It enables me to know when it's too risky to get involved and when the chance of being correct is higher. It helps me to understand when to buy and when to exit, without that its all hope, greed and fear! It does enable you to understand the feelings of the market. You do need however to understand not just the prices but candlesticks, RSI, MACD amongst other things. I always trade with knowledge of the news but the market much more often follows the TA than the news, simply using todays news to justify todays moves. 70% of professional traders use TA so if you don't understand the language of the prices you are at risk of getting burnt.

My TA analysis of Fridays happenings is that there is nervousness about the price of gold. On the weekly and daily charts it was mildly overbought with an RSI of 68-70%. Previous big corrections have been at the 85% level. Fridays drop held where I would have predicted at 905'ish. On the 15th of January (daily chart) there was a bearish engulfing pattern. This is the most recent notable pair on the chart. The price came to this level and towards closed became a descending triangle on the intraday charts.

What is the next move? Short term descending triangles breakout to the positive and negative exactly split, so no help there except to watch very carefully on Sunday evening as that is likely to mark direction of a fairly sizeable move (and the far eastern markets have mostly dropped the price overnight in recent trading). The weekly chart incorporating Fridays prices shows a shooting star. A possible reversal but not confirmed unless this weeks price pushes a good way down the price from two weeks ago. If that happens we will probably be in for 4-5 weeks of price declines.

I'm a rank amateur but Trading Central's analysis is a week of consolidation followed by a push onto $970/1010.

From my point of view the 'dramatic' move on Friday in GBP terms removed only 1.4% of the pound price. Not exactly earth shattering, much of the reduction was dollar strength rather than gold weakness. I expect an interest rate cut in Feb which will probably add a further 5% to the Gold/GBP equation.

For the medium term it strikes me that when the worlds largest economy has interest rates lower than inflation, the worlds second largest trading area has increasing problems with inflation and all of the BRIC countries are seeing marked inflation the gold price is going to at least $1000 this year.

I'm keeping a steady nerve but have a deal ticket open ready to short against my physical holdings if things look to get temporarily choppy!

Useful info....Thanks

Steve

[R K]

Hi Steve... Sorry, perhaps some mis-phrasing on my part. I wasn't criticising your particular chart. I was saying that (by definition) a TA chart doesn't look at why people are buying and selling. In my mind that means it "fails" to take this into account - but I agree it is not its aim.

So what? Most of the news explaining why prices have moved in a particular way are incorrect. It is mostly irrelevant and just sells papers/pays commentators.

You are making a very big assumption that the news has any relevance whatsover to the players in the market.

The price is telling you everything you need to know. You would say that if the price of say gold soars because of reported political instability in say, Pakistan, then that news is the cause. I would say, so what. The price has soared. That is telling you all you need to know.

TA is giving you important information about what is actually happening and thus, risk. It is a guide, not a prediction, but improving risk management improves your chances of being correct over different time frames.

If you are participating in any market and disregard price movement and what that is telling you then I would suggest you are increasing your risk markedly.

[Guest Steve Cook]

.....Looking at price history charts gives me the feeling of wanting to do something all the time, I read too much into every movement......

Actually, you do make a very good point there.

I have to admit that too much scrutiny of charts does indeed tend to prompt one into action merely for the sake of it. I have found myself to be guilty of this on occassion.

Steve

Edited February 3, 2008 by Steve Cook

[azazel]

What difference would it have made if you was to the end of last week, the begining of last week or two weeks ago? None as gold was about the same price on all occasions. Its easy to say in hindsight as to when to buy. Should you have bought at $750 or are you still waiting for a correction? I hear that now is a bad time to buy as there could be a big correction but I also hear that gold will be at least $1000 an ounce by the end of the year or even $1500.

I would think that there is no time like the present to buy gold but only if you are in for the long run. But then I'm just a fool

[uro_who]

So what? Most of the news explaining why prices have moved in a particular way are incorrect. It is mostly irrelevant and just sells papers/pays commentators.

You are making a very big assumption that the news has any relevance whatsover to the players in the market.

The price is telling you everything you need to know. You would say that if the price of say gold soars because of reported political instability in say, Pakistan, then that news is the cause. I would say, so what. The price has soared. That is telling you all you need to know.

TA is giving you important information about what is actually happening and thus, risk. It is a guide, not a prediction, but improving risk management improves your chances of being correct over different time frames.

If you are participating in any market and disregard price movement and what that is telling you then I would suggest you are increasing your risk markedly.

Exactly.

The important thing is the price, how it moved, how it's changed during the session. That contains all of the knowledge regarding fundamentals, geopolitical changes, moves by big players and critically the reaction of all those in the market to those factors. Its usually humbling to try to guess where the market is going based on your interpretations of the news. The better way is to watch the market and agree with it by acting in the same way. No point in being correct and poor. I learnt that mistake when in 2003 I sold my house couldn't find another, I noted that the market had levelled off. I held on and it surged ahead. Using TA I no longer want to be correct before the move even happens because you'll be wrong at least 50% of the time, I use it to try to spot a real breakout/price move from a fleeting change in price. And as Red Kharma says because markets are fractal it works across time frames.

Let me give you an example.

When gold started its correction on the 9th of november the drop was presaged by a shooting star and an RSI of 77%. It then corrected with a triangle. It finally broke out of the triangle to the upside on the 21st of December ($808/oz). TA analysis states that once its broken out to the upside you've an over 90% chance it will at least reach the prior high of the triangle. It reached that on the 2nd January, it surpased the $847 as predicted and went on that day to reach $857. If you take a look at the chart the next couple of days were nervous before taking off again (it had crossed the all time high price remember). (all prices are mid point between bid and offer). A spread bet at £20 per point is equivalent to about £15,000 of physical gold. Over that couple of days you had a greater than 90% chance of earning £1000 for the risk of losing £50 if you place your stop carefully. You also know to take your profit by moving your stop upward until you reach $847 and then play it by ear. If you look at the charts you can see that many have taken their profits at exactly those times. You have now joined the 70% of chartists in the market and taken the cash of the 30% who had a feeling in their water.

None of that had anything to do with news. Mostly that involves market players trying to manipulate the price for their own ends!

[uro_who]

As a point of interest the upper - resistance line of the triangle was at about $906 on Friday. The gold markets are closed at the moment but gold is changing hands on BullionVault in NY for about $907, London for $906 and Zurich $909. The Aussies, Japanese, Chinese however will really set the agenda at 12 o'clock tonight.

[Wallis]

As a point of interest the upper - resistance line of the triangle was at about $906 on Friday. The gold markets are closed at the moment but gold is changing hands on BullionVault in NY for about $907, London for $906 and Zurich $909. The Aussies, Japanese, Chinese however will really set the agenda at 12 o'clock tonight.

Does anyone think we may see short -term $ strength which will weaken the price of Gold. It looks like we may have seen the bottom of US rate cuts for at least a couple of months.

It may be now the turn of the markets to pick on other currencies to weaken like the Euro /and GBP as they now play catch up with rate reductions . this I think may lead to a sharp short term $ bounce,

Anyone agree ?

[whoami]

All this talk about the intricacies of TA, I don't know. Sheesh guys, it's a lot simpler than that.

I've said it before and I'll say it again: 70% (some days 100%!) of gold intraday movement is simply dollar forex noise. Even last Friday, with its much vaunted gold 'price drop', it was mostly forex related (yes, even the drop). Pull up Friday's 24-hour charts for gold, EUR/$ and GBP/$ and compare them if you don't believe me.

If you want to accurately analyse gold movements on any day you need to strip out the forex noise before you start analysing. Not sure how you do that but I can guarantee you'll be left with very little to look at bar a slightly twitchy horizontal line. Alternatively, just do TA on the dollar/GBP exchange rate and its resistance levels and buy that instead - you'll probably make as much money.

Longer term, of course, there are up and down trends in the forex-corrected gold price which are worth studying, plus now and then market openings will introduce a correction factor up or down, plus there's the mysterious early afternoon smack-downs. But as far as I can see most of the rest is forex noise and frankly not worth time analysing from gold's point of view.

[Wallis]

All this talk about the intricacies of TA, I don't know. Sheesh guys, it's a lot simpler than that.

I've said it before and I'll say it again: 70% (some days 100%!) of gold intraday movement is simply dollar forex noise. Even last Friday, with its much vaunted gold 'price drop', it was mostly forex related (yes, even the drop). Pull up Friday's 24-hour charts for gold, EUR/$ and GBP/$ and compare them if you don't believe me.

If you want to accurately analyse gold movements on any day you need to strip out the forex noise before you start analysing. Not sure how you do that but I can guarantee you'll be left with very little to look at bar a slightly twitchy horizontal line. Alternatively, just do TA on the dollar/GBP exchange rate and its resistance levels and buy that instead - you'll probably make as much money.

Longer term, of course, there are up and down trends in the forex-corrected gold price which are worth studying, plus now and then market openings will introduce a correction factor up or down, plus there's the mysterious early afternoon smack-downs. But as far as I can see most of the rest is forex noise and frankly not worth time analysing from gold's point of view.

mysterious early afternoon smack-downs....seen that a few times ..usually when the yanks come in.. me thinks it the big net short players trying to flush out 'weak longs'...they acutally bury Silver on these smack downs...but I usually buy on these dips as the rallies are just as violent.