Lunar Cycles and Puking Camels

I have spent hours, days even, immersed in technical analyses of the price of gold, the sustainability of the Dow’s rise, the duration (and endpoint???) of the Venture’s slide, the copper supply-demand-stockpile situation, and whatever other data seemed important that day.

I have spent an equal amount of time reading about the randomness of the market, how tradeable patterns only happen three times before traders annihilate them, how that action irons out big picture trends, and how you’re better off betting on a race between drunk puppies.

The truth is somewhere in the middle. Some events or developments are predictable; others are not. The market reacts to each in different yet related ways. Emotion and momentum definitely create significant patterns, some of which are tradeable.

But the harder you look, the more patterns you will see. Which brings me to my two new favorite technical analyses of the price of gold.

Vampire fans will love the first, which proves that gold moves with the moon’s cycle. I mean, every full moon corresponds to a gold peak, trough, or price acceleration. Clearly.

Credit to tech analysis guru Tom McClellan of McClellan Financial Publications, who used it in his daily McClellan Market Report yesterday.

Realizing the overlap of two patterns, like lunar cycles and the price of gold, is one form of technical analysis. Another is using trendlines, which smooth out daily gyrations and make momentum movements more obvious.

When these trendlines develop around the price of gold, traders tremble.

Some tremble in fear, knowing that camel vomit is highly acidic and thus burns a hole in the ground one-third as deep as the camel’s kilogram mass in centimeters. (Camels average 800 kg so vomit holes are easily 2.5 metres deep – a touch more than the camel’s hoof-to-hump height.) A full camel puke would take gold down to US$750.

Other tremble in anticipation, knowing that camel vomit has just the right elasticity and surface tension to bounce. Bounces average the pint volume of the vomit in decimeters, so a serious 7-pint puke becomes a 70-cm bounce – usually about camel shoulder height. From there the wind speed and direction take over, so it’s anyone’s guess.

I’m worried and excited. The next full moon is Dec. 8, so if the bouncing vomit indicators are correct we should be in for some serious pre-Christmas upward gold price acceleration! If the camel vomit holers have it nailed, however, Dec. 8 will be a gold bottom not seen for a decade.

Pack your planetary ephemeris and saddle your camel folks – science says it’s going to be a wild ride.

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