Call 800 665 0411 to learn about our services for your stock

Search   Follow Investorideas on Twitter   Investorideas is on Facebook   Investorideas is on Youtube   Investorideas is on Pinterest  Investorideas is on stocktwits   Investorideas is on tumblr   Investorideas is on LinkedIn   Investorideas Instagram   Investorideas Telegram   Investorideas Gettr   Investorideas RSS

Share on StockTwits

Gold Erased Its April Rally - What's Next?


May 1, 2023 ( Newswire) April had started with gold at $1,990, then gold moved as high as $2,063.40, and yesterday, it closed at $1,999. At the moment of writing these words, gold futures (because that's what you see on the above chart) are trading at $1,993.

Monthly Reversal Candlestick

This means that gold formed a huge monthly reversal candlestick. Since the opening and closing (assuming that the current price will be the final price for the end of April) prices are almost identical, this candlestick is called a "gravestone doji".

If gold moved a bit higher from here, it would create a "shotting star" candlestick based on its April price movement.

And if it moved a bit lower from here, it would... Also create a "shooting star" candlestick, just a different one.

What would the difference be?

None, because all those candlesticks are reversal patterns. In other words, the implications are almost certainly going to be bearish after today's session, regardless of what fancy name we use to call this month's price movement.

The only thing that could make this month's candlestick bullish would be a rally of at least $30, which would have to happen today. And based on the analysis of gold's pre-market decline, it's highly unlikely that we'll see something like that.

I wrote on numerous occasions about how important weekly gold price changes are, but monthly price changes take it to yet another level. A full month is enough time for any price noise to average-out and disappear. What ultimately happened?

This month in gold, ultimately, nothing happened except gold's failure to break above $2,000.

The monthly reversal is a very powerful, bearish indication that points to lower gold prices in the following months.

Historical Comparison to 2008

How can things get any more bearish based on the above chart alone?

They actually can - please look at how gold started its sharpest decline of the past decades. That's right, I mean the 2008 one.

Gold started it right after a monthly reversal! I marked the previous monthly reversal and the current one with orange arrows. The history tends to rhyme, so the implications here are very bearish.

There's one additional thing about 2008 that I would like to emphasize here.

Namely, if you look at the size of the pre-slide corrective upswing we saw in 2008, you'll notice that it's practically identical to what we saw recently.

Sure, gold didn't rally as sharply now as it did back then, but the overall size (percentage-wise) of the rallies is very similar. That's what I marked with green rectangles.

So, yes, even though the recent rally seemed like a game-changer to many, it's all within the self-similar pattern that ended with a massive decline.

More Info: Newswire

This news is published on the Newswire - a global digital news source for investors and business leaders

Disclaimer/Disclosure: is a digital publisher of third party sourced news, articles and equity research as well as creates original content, including video, interviews and articles. Original content created by investorideas is protected by copyright laws other than syndication rights. Our site does not make recommendations for purchases or sale of stocks, services or products. Nothing on our sites should be construed as an offer or solicitation to buy or sell products or securities. All investing involves risk and possible losses. This site is currently compensated for news publication and distribution, social media and marketing, content creation and more. Disclosure is posted for each compensated news release, content published /created if required but otherwise the news was not compensated for and was published for the sole interest of our readers and followers. Contact management and IR of each company directly regarding specific questions.

More disclaimer info: Learn more about publishing your news release and our other news services on the newswire

Global investors must adhere to regulations of each country. Please read privacy policy:

That's all it takes to get an article published on Investor Ideas - Learn More

Gold Mining Stocks - Gold Mining Stocks Directory, Gold Stocks News, Research and Resources - investing ideas in gold and mining stocks

Like Gold Stocks? View our Gold / Mining Stocks Directory

Get News on Mining Stocks