GOLD at a key juncture possibly.

Of all the Markets which have confused me during my time as a trader, the one which has baffled me the most and has probably floored me more than any other is Gold................ I don't profess to be an expert on Gold, infact a quick look back at the few Gold trades I have done over the years will confirm just that.... However, I do look at Gold and start to wonder exactly how high it can go, given its quite amazing gains over the past decade, particularly in light of the performance of most other asset markets during this time and considering the deflationary winds blowing across the major western economies. I am not however going to try and debate reasons for and against buying or selling Gold, this is covered in depth in a million or so blogs and news services elsewhere, however I am going to post a few charts, which I hope may shed some light on where I think Gold may be heading...

Firstly I will show 2 sets of fractal patterns, one with Bearish possibilities and the other with a potential Bullish outcome:-

The first set of chart show a series of Rising Wedges embedded within each-other, rising wedges are potentially bearish patterns.

The second set of charts show the Gold over the same period, however this time I have identified each pattern as a series of Bullish 'Cup & Handle' patterns.


The third set of charts shows the performance of Crude Oil 2007 and 2008, together with a similar set-up on the weekly Gold chart. I will admit, that if one looks closely at the two charts, there are many differences, however I am trying to capture the essence of the moves, which on both charts show two converging arcs of support and resistance.
My head says the arc converging from the left should win, and turn Gold sharply lower, however there is no reason why this could not break in favour of the sharply rising arc, particularly as this arc has a longer duration. If this were to break to the upside, it could quite possibly project Gold sharply higher. Either way, I think soon we will see a sharp move.

I will confess, at this stage I have no idea which side will win, however I think it worth watching a break of either 1200 and 1300 for the next significant move....