rGold is a simple calculation which stands for “relative gold”. It is the price of gold divided by its 200 day moving average: POG/200DMA.
Roger Martins: It is a calculation originally used with a trading process we developed during the 1980’s with a system called the “RMU” system - “Relative margin expressed in units”.
Adam Hamilton: “Relativity is a trading theory I developed ......” Relative Gold Bulls 2
When rGold is ....
|
above 1.5 |
about as high as it gets |
|
above 1.25 |
red (Hamilton) |
|
1.25-1.3 |
a screaming sell (Martins) |
|
1.2-1.25 |
a hold to mild sell depending on which direction it is moving (Martins) |
|
above 1.2 |
Gold sell zone (Hommelberg) |
|
1.1-1.2 hold |
a buy (Martins) |
|
below 1.1 |
|
|
below 1.05 |
green (Hamilton) |
|
below 1.01 |
Gold buy zone (Hommelberg) |
|
below 1 |
a screaming buy (Martins) |
|
below 1.0-0.9 |
“sell the house and buy” (Martins) |
Roger: “Check it out, every top with a major correction happened at those levels and every major rally occurred from exactly the same levels.”
This Adam Hamilton page contains a chart showing Relative Gold 2009-2012.