The Gold Update: No. 883 – (17 October 2026) – “Gold Basing Against Its Short Trend’s Tracing”

“And what does it all mean, mmb?”

That hindsight is a beautiful thing, Squire.  The Moneyflow has triggered 10 swing signals since November 2025, naturally alternating back-and-forth between Long and Short, (notwithstanding our tenet that “Shorting Gold is a bad idea”).  A Long signal is confirmed upon price passing up through and settling above the Moneyflow’s thin green line, else a Short signal if passing and settling beneath the thin red line.

But to the point:  were one to have determined in trading a single COMEX Gold futures contract ($100/point) to target 35 points (i.e. $3,500/trade) of price follow-through per signal, such goal was achieved for all ten following cases as cumulated via the conservative blue line in the above graphic’s lower left panel.  However, ’tis not so simple per this two-bullet cautionary note:

• The Math:  We’ve referred in the past to the great French polymath Pierre-Simon, Marquis de Laplace, whose probability formula determined that if a like result is obtained ten consecutive times (in this case 35 follow-through Gold points per signal), the odds of an 11th like consecutive occurrence is 91.67%.
   
• The Reality:  Specific to markets, the odds of an 11th consecutive like occurrence is actually 50.00%.  Do try not to get carried away.

But wait, there’s more (a lot more):  see the aggressive cumulative green line in the above graphic’s lower right panel?  That’s the pure swing result across the 10 signals without targeted follow-through.  It totals $232,940 (ex-slippage and commissions) on a base margin requirement of $21,000, (i.e. an 11-month return in excess of 1,000%).  The reason ’tis working so well is the vast expanse of Gold’s bi-directional trading range through these many months.  However, it shan’t continue in perpetuity because it never so does.  A word to the wise therefore is sufficient, this again merely being an exercise given hindsight:  foresight is up to you.

Now to our wise view of Gold’s weekly bars and parabolic trends from one year ago-to-date.  Therein we see a third week of red-dotted parabolic Short trend, although our sense is Gold’s downside is limited to “The Floor” at 4000, (albeit as the sole recipient [JGS] of the first edition of The Gold Update would opine:  “There’s always the overshoot”).  Either way, as herein cited a week ago, we are comfortable with today’s Gold price, it having settled yesterday (Friday) at 4187 as sandwiched between Fair Value of 4011 and our BEGOS Market Value of 4293, (the latter determined by price’s movement relative to those of the five primary BEGOS Markets being the Bond, Euro, Gold, Oil and S&P 500).  That said, the tilt of the whole chart has rotated to negative per the dashed regression trendline.  But given the inevitable Federal Reserve “mass creation” of more faux dough, broadly the buyside clearly is the way to go.  And as our title states, price near-term appears more to be basing than downside tracing: