A reasonably good case can be made that Gold Futures are at a major juncture here. I made a few points that supported this possibility in a previous post. Perhaps relying on the monthly MACD is somewhat simplistic. But you would be surprised how accurate this one simple indicator can be in picking major tops and bottoms or either intermediate or longer term nature.
Cycle Turning Point in US dollar right on PEI date
There is another piece of evidence that hints the dollar bounce this time will be more sustainable and have a good shot at being either 23 or even 38% retracement. I am talking about the Marty Armstrong Princeton Economic confidence model turning point. The last one occurred precisely on January 1st, 2005. If you look closely at the price chart of the US Dollar index you will see that the US dollar also turned precisely on this particular date. Right after this Princeton Economic Confidence model turning point, the US Dollar showed a big sign of strength on the weekly basis. This last week it has also shown a sign of strength.
I was going to post a link to that PEI Economic Confidence model chart which shows the January 1st 2005 turning point, but I cannot find the link at the moment. I will post it up here soon (by early next week) when I find it.
This chart is just a closer up look at the daily prices. You can clearly see the straight up trend line that has defined gold's move up from 2003. A break or very sloppy or weak reaction at this line in the upcoming weeks could warn the uptrend will be broken and provide yet more evidence that a much longer retracement/consolidation is due for the Gold market.
As I have said before, it is usually not a good idea to fight an intermediate term trend change. I have also said that I do not believe this is the end of the bull run in gold. I have a chart that makes a good argument that the bull market is in fact just starting. The key is always a question of time frames.
By the way, if gold is going to be making a major intermediate term top (still to be confirmed), then one has to wonder about other commodities? Are they making a top too? I will try to look into this in the weeks ahead.