It's Hard Now To Imagine How Gold Won't Break Out In The Near Future

It's hard now to imagine how gold won't break out (break the multi month downtrend since 3-17-08) in the near future (next week or two), see the second weekly view chart at http://stockcharts.com/charts/gallery.html?%24gold.

Now that GDX/HUI/XAU (http://stockcharts.com/charts/gallery.html?%24xau) put in a Wave 4 monthly cycle low yesterday 1-15, and, have shot up like a rocket, it's obviously likely, from looking at gold's weekly view chart, that it will break it's multi month downtrend since 3-17-08, see the second (weekly view) chart at http://stockcharts.com/charts/gallery.html?%24gold.

Also, note that gold did an inverse Elliott Wave 12345 down up down up down pattern, from the 3-17-08 Wave 1 Cyclical Bull Market cycle high at $1033.90, to the potential Wave 2 Cyclical Bear Market cycle low at $681 in late October 2008, see the second weekly view chart at http://stockcharts.com/charts/gallery.html?%24gold. Note also, that in both the first daily view chart and the second weekly view chart, that gold has a very large bullish inverse spike at the $681 cycle low in late October 2008.

Also, looking at the first daily view chart one can see that gold created a bullish breakaway gap today 1-16-09, see http://stockcharts.com/charts/gallery.html?%24gold.

So, we'll see what happens, but, it's now hard to imagine gold failing to break out in a major way (break the multi month downtrend since 3-17-08 by 5% or more) in the near future (next week or two), given that gold stocks (which lead the metal) are roaring to the upside, and, gold isn't too far from it's multi month downtrend line.

If gold fails to break out in the next week or two, then, it's probably headed much lower, to $400 to $500, with $681 in late October 2008 very likely being a Wave A type cycle low.

So, now that GDX/HUI/XAU (http://stockcharts.com/charts/gallery.html?%24xau) entered a Wave 5 monthly upcycle yesterday 1-15-09, and, have roared to the upside, my thinking about gold has changed drastically, from believing that $681 was a Wave A type cycle low, to now believing that it's probably a final Wave C cycle low, of the Wave 2 Cyclical Bear Market since 3-17-08.

The important thing regarding major cycles isn't human analysis anyway, it's cycle trendline 5%+ major buy/sell signals.

Note that this is another example of GDX/HUI/XAU leading gold, because, they clearly/decisively broke out on 12-10-08, see annotated chart one at http://www.joefrocks.com/GoldStockCharts.html.

.......http://www.JoeFRocks.com/

NEM XAU HUI