I was a guest on BNN’s Market Call on Monday and I
have to apologize to a BNN caller who asked about gold and a Fibonacci
Retracement. I skated around the answer because – without a chart I just stated
that 50% was not a Fibonacci number. Fibonacci Retracements are ratios used to
identify potential reversal levels. The most popular Fibonacci Retracements are
61.8% and 38.2%. Note that 38.2% is often rounded to 38% and 61.8 is rounded to
62%
Our
chart is a monthly of gold setting out the advance from financial crisis low –
of about $700 to the 2011 price peak of about $1900 – then down to the current
lows of about $1160. The current retracement number is about 62%.
Most interesting is a look at the TSX most actives at
the close July 8 – out of a total of 100 most actives only about 15 issues were
up on the day – 10 being gold stocks – some symbols, ABX, BTO, LSG, NGD. G, K,
ELD, AFM and AR. I just took a call form Fibonacci who thinks now is the time
to bottom fish.
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