Loading ...Gold and Miner Cycle Thoughts
This post is meant to “Curb your Enthusiasm.” (okay, so I’m a Larry David fan)
On reviewing the charts this weekend, the current uptrend in the Miners and Gold is parabolic and not really sustainable longer term, IMO. Both are also in their timing band to find a shorter term Trading Cycle Low sometime this week or next (which might be a good buying opportunity).
Cycle Lows are needed to reset investor sentiment which will allow an uptrend to resume if the Bull has returned. From this cycle perspective, it would seem that we need at least a 50% to 62% retrace to provide a more reasonable and sustainable uptrend channel if the Bull Market is to resume properly.
My Gold and Miner charts below show a large Blue Fork which perhaps show a reasonable channel for the rest of 2016 but now we need a decent IC Low to provide a more reasonable Fork channel into the Intermediate Cycle High (I am expecting the next IC Low in April perhaps where I would also expect that Stock may chop into a Cycle High).
Remember, Gold is on week 12 next week so it could even be nearing an Intermediate Cycle top especially if Stocks and the USD have found an IC Lows and continue to bounce here in the weeks ahead. An IC top here in Gold is not my preferred cycle projection but it is a possibility. The quality Miners, however, are likely a different story as there cycle timing has potentially diverged from Gold.
While these channels are speculative based on the Bulls resumption, the smaller green forks are still quite steep and they are based on a 62% retrace in both Gold and the Miners.
My last chart is a historical chart of the HUI from the V bottom back in 2000 for reference. Note that it also had a parabolic rise in Trading Cycle 1 but chopped sideways for most of TC2 creating a more sustainable price channel for the Bull to launch.
