GOLD TO RISE: “It has now gone from an arithmetic rise into a period of time where exponential rises are not only possible, they are probable.”
“The Square of the Numbers”
“In 1923, renowned investor Jesse Livermore wrote an article in the Wall Street Journal called “The Square of the Numbers.” I will save the mathematics of his economic model for another time, but he used it to predict stock movements very successfully. What is of note regarding this model is that gold broke through a key technical area yesterday when it rose above $1,764. Until then it was rising arithmetically. It had a nice angle of appreciation, but wasn’t parabolic. I would characterize the rise as two steps up for every one step back. It behaved as a healthy stock should. According to Jesse Livermore’s economic model it has now gone from an arithmetic rise into a period of time where exponential rises are not only possible, they are probable.
$1764 signifies a loss of confidence. According to Livermore the loss of confidence would be in the fundamentals or the management of the stock. However, in the case of gold the loss of confidence is in the depths and duration of the Western world’s economic problems. For gold to begin to move exponentially there has to be a mass change in the psychology of the entire world. The sentiment in the West has turned very negatively toward national currencies and positively toward gold with the expectation that it will keep running.” Source:>>>>>>>