Gold Gets Life, Sort Of...

It was just one week ago wherein we bemoaned that a lifeless Gold had fallen out of bed. Today it would appear Gold's getting banged on the floor has brought some life back to price, and moreover, some volatility.

To be sure, the year is young. Nevertheless after making a year-to-date low at 1275 just on Thursday, Gold then made a year-to-date high at 1303 less than 48 hours ago on Friday, indeed settling at that price yesterday for the week. And from the "Oh Goody Goody Dept." with Gold's trading volume this ensuing week rolling from the February contract into that for April, in a week's time we'll have added another five-to-six points of premium into price. Life is good. Of course we ought to point out that it was in the final hour of Friday's GLOBEX trading (from 21:00-22:00 GMT) that Gold got a good dose of pop (from 1299-1303) on volume far higher than is normal for that period. Perhaps it was coming through? 

Still, Friday alone was Gold's best intra-day low-to-high percentage move (+1.9%) since December 20, and further it was the best intra-day low-to-high points move (+25) since 12 October. However, said move flew in the face of one of our most favored technical readings -- the "Baby Blues" -- with which we start straight away. Regular readers know these blue dots as portrayed by the day from three months ago-to-date for Gold on the left and Silver on the right represent the consistency of price's linear regression trend. And at present the dots are in full cascade for both precious metals, Friday's"wunderbars" notwithstanding:

Either way, in turning to Gold's weekly bars, a tip of the cap is due the present parabolic Long trend: now sporting 20 weeks of duration, it ties for the fifth such lasting trend (with that ending 09 January 2004) millennium-to-date. Notable Technical Note: for the prior five Long trends of like or further duration, following their then subsequent Short malaise, the low-to-high price ranges in two cases of their next Long trends exceeded +30%. While we don't how low Gold's next Short trend may go (and let's say it is modest), if then arbitrarily measuring from the top of The Box (1240-1280) such that a +30% move be realized, we're talking Gold well north of 1600. Impressive? Sort of... Of late, Gold has yet to fully escape The Box, nor has the Gold/Silver ratio departed the lofty 80s levels. And as we've said a bazillion times, you aren't really going anywhere until you clear Base Camp 1377:

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