Gold Is About to Take Off Again: Candlestick Patterns Say So

After a breathtaking decline from the heights near $1230 per ounce, an upside reversal in Gold is due.  The first chart shows two clear Candlestick Upside Reversal Warning Bars – a High-Wave Spinning Top followed by a Hammer, both of which appeared at the bottom of a clear downtrend.  The small white Candle represents overnight trading, and appears to be responding to the bullish implications of the Spinning Top and of the Hammer which immediately preceded it.

The second chart shows that the Stochastics are turning up, which is a bullish signal.  The third chart (the “Chandelles” chart) demonstrates several indications that prices will now rise:  1) There is a “Paunch” between ADX and Stoch K, which calls for a cure, and we can see that cure now beginning to develop at Stoch K starts to bend up; 2) Chandelle 1 has given Bollinger Percent B a “kick in the ankles,” whereupon Bollinger Percent B (the green line) has started up, together with prices; 3) there is a “Paunch” between Chandelle 1 and Chandelle 2, being in the nature of a “vacuum” which cannot long persist; whereby Chandelle 2 is very low, has flattened out, and will shortly begin to bend up, together with prices as depicted in Candlestick format.

William Kurtz

December 11, 2009

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