Then July 30th and now charts as usual;
Back at the end of July we were looking for a wedge in Gold. It could be an expanding diagonal or a contracting diagonal. Our target was about $1050 or so (see blogs). Much depended on where you started the pattern. With the benefit of hindsight we have moved the starting point one notch to the right. This has the effect of sharpening the wedge and giving it a much better look. These are both contracting triangles. The expanding one is below;
The expanding pattern, in green, never materialized but at least the target price was spot on, so far at least. It has become a contracting wedge and there are at least 3 or 4 different ways you can view the pattern, but in the big picture we have to assume that the drop is done. In the minute picture I would not exclude a quick $40 or so up and down sequence just to make the 5th wave a clearer 3-wave affair than it is now. Additionally all three downlegs would become directionally equal and it would get us closer to year-end.
Gold should do well with expansive monetary policies, not if interest are about to increase. Given this weeks events it is therefore odd that gold should spike up today. A little wavering at the very last moment could cause some big swings. Ultimately the upleg should retrace this entire wedge or about 38% of the $900 drop. Both point to a little over $1400.