The Gold Moon Launch Has Been Delayed

The gold price is trapped in a box. I'm not saying it is going to be trapped there forever, but it's trapped right now. The above pivot chart shows the price bars for gold on a daily basis. You can't see underneath the last bar, but there are two pivot points very near to the black horizontal line drawn at the $1,235.30 level. $1,235.30 is a very important Fibonacci Retracement Level - the 0.50 level to be exact - for gold. It's a level that seems to have given gold quite a few problems.

In fact, you can't see it on the chart, but you'd have to back to October to find the last day that gold finished above that level. There's a few other interesting things about this first chart. If you look at the bottom volume bars, you'll see a red 50-day moving average of the volume. The last three up days (green bars) in the gold volume are all on below average volume. That speaks to the conviction of this rally in gold, which is to say, until we get a daily higher, on above average volume, this rally doesn't mean all that much.

The next chart seen above is a weekly gold chart. You'll quickly notice a difference between the far right of the chart and most of the rest of the chart to the left. The right-hand side is generally a picture of a declining gold price. That' not a major newsflash by any means. There are two important indicators used on the chart. The first is a volume weighted moving average (the sometimes red, sometimes green line). Since the end of 2012, it has spent the vast majority of its time colored red. So, adjusted for volume, the weighted moving average is telling us that the trend in the gold price is down.

The other indicator shows if the bulls or bears are in control of a market. This indicator says the bulls are in control. So, this contrasts what the VWMA indicator above says. However, you'll notice that since 2012 control has traded hands many times, but that the bears have mostly had control. In fact, only one time - back in February of last year - did the bulls assert strong control. The current grasp of the bulls on this market is weak at best until price, volume, VWMA, or this bull-bear indicator says otherwise.

As an aside, the gold miners have had a pretty decent run so far in 2015. If you subscribe to Investor's Business Daily, you will see that the miners have (in percentage terms) been one of the better groups. However, as an industry group they are still way down the list of IBD's 197 groups. That means it would still be a risky bet to invest in gold or silver miners at this point, especially given that the stock market seems a bit wobbly right now.

Bottom Line: The Gold Moon Launch Has Been Delayed.

Bonus: Simulated Gold Moon Rocket Launch: