 ChartWorks
Gold - Taking a Well-Deserved
Breather
Technical observations of RossClark@shaw.ca
Bob Hoye
Institutional Advisors
October 15, 2004
The gold market is down $10
from last week's high while the XAU & HUI indices are down
4.5%. However, there was no divergence between the bullion and
the stocks at the top so we will treat this correction as the
start of the anticipated pullback (not part of a topping formation).
Support starts at $413, but could be as deep as $405 without
violating the uptrend.
The HUI generated its
upside exhaustion reading at 231.38 on September 30th and after
a brief flurry (with a divergent RSI) it is now at 227.92.
I will send an interim alert
once the short term oscillators generate an oversold reading
on the index and include a list of stocks that exhibit strong
accumulation patterns.
Silver overshot its upside projection, but the RSI(14)
levels of 69 to 72 were enough to thwart the rally. The current
correction should last 6 to 8 trading days (Oct 18th to 20th).
If it is mild and holds at $6.70 then we can project levels approaching
$8.00 on the next rally. If the break is deep it should have
a lethargic bounce from $6.20. I will update the analysis this
weekend.
Bob Hoye
Institutional Advisors
E-mail bobhoye@institutionaladvisors.com
Website: www.institutionaladvisors.com
CHARTWORKS
October 12 2004
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