Loading ...It’s time to sell everything PM’s related?
I propose again my comment about the battle between the bull and the bear since the latter seems to be an easy winner at the moment. (21 years bear market option)
Gold was in a bull market from around 1970 to 1980 (10 years)
Gold was in a bull market from around 2001 to 2011(10 years)
Gold was in a bear market from 1980 to 2001 (21 years)
Gold should be in a bear market from 2011 to 2032 if we have seen a secular top in 2011.
The differences are :
Gold went from 35 to 873 in the 1970-1980 bull (25 fold increase)
Gold went from 250 to 1923 in the 2001-2011 bull (7.7 fold increase) a very poor performance.
Silver did NOT make a new all time high in 2011
IF we are still in a bul market the similarities are:
1st bull wave from 1970 to 1975 went from 35 to 195 (around 6 fold increase)
1st bull wave from 2001 to 2011 went from 250 to 1923 (around 7.7 fold increase)
Wave 2 (major correction) from 1975 to 1977 went from 195 to 103 (53% correction)
Wave 2 (major correction) from 2011 to 2016 went from 1923 to 1045 (54,5% correction)
So IF we are still in a bull market and the analogies continue we should be in the last wave of the bull market that should drive the gold price around 6000.
Time is against the bull market probabilities,price is still in favour.
If the major wave 2 from 1000 to 680 was the major wave 2 of the bull market from 2001 to 2011 the gold bull is probably over.
(Chart from Alf Field courtesy from Bikoo)
This is the second time you have written about correction in gold.
From past here is an article written by Alf Field in 2011 along the same line.
http://www.321gold.com/editorials/field/field111611.html
The technique is to concentrate on the corrections. In terms of EW, the sequence in a bull market is as follows. The market rises, has a 4% correction, rises, has a 4% correction and rises again. At this point the next correction jumps from 4% to a larger degree of magnitude, say 8%. The market then repeats the sequence. A rise, a 4% correction, a rise, 4% correction, a rise and another 8% correction. When the market is eventually due a third 8% correction, the magnitude of that correction jumps from 8% to 16%. This sequence is repeated until two 16% corrections have occurred when the size of the next big correction jumps to 32%.
“Once this correction has been completed, Intermediate Wave III of Major THREE will be underway. This should be the largest and strongest wave in the entire gold bull market. The target for this wave should be around $4,500 with only two 13% corrections on the way. ”
Note target was calculated fro higher price.
“Once this correction has been completed, Intermediate Wave III of Major THREE will be underway. This should be the largest and strongest wave in the entire gold bull market. The target for this wave should be around $4,500 with only two 13% corrections on the way. ”
But the current correction was not developing when this article was written.
“Using this method I calculated that the gold price should rise from the $300 ruling in 2002 to at least $750 without having anything worse than two 16% corrections on the way. That was valuable information at that time. Furthermore, from the $750 target a big 32% correction could be expected to about $500. Then the bull market would resume, rising to perhaps $2,500 before another 32% correction occurred. The final up-move would take the gold price to much higher levels, possibly $6,000. Once again, a valuable insight when gold was $300 in 2002.”
This is the same conclusion that I have reached IF we are still in a bull market,but was the correction from 1000 to 680 a MAJOR two correction?
This is the most important question we must ask ,if the answer is YES the bull market is probably over.
(Look at the first chart included in the Art Field article,it shows exactly what I’m talking about)
“But the current correction was not developing when this article was written.”
Yes it is correct. But he anticipated a major correction. then he wrote final article when gold was at 1530 in 2013. After the fall in April 2013 below 1500 he went silent.
Thanks nice work.
It is interesting to see how the gold cycles correlate with US dollar cycles.
This correction, unlike the mid 1970s one has been during a bull market cycle for the dollar (8 years), though gold made a new high in 2011 while the dollar did not make a new lower low than it did in 2008. (That was similar to the 1999-2001 period when the dollar made new highs and gold did not make new lows).
Anyway, how long does this dollar up cycle bull market last? It’s usually around 8 years. If you time it from the USD bottom in March 2008, it should be ending soon – but will it? The key will be how will gold perform on the next dollar decline cycle of 8 years and when will that cycle start? It is due. Will gold make new highs or will it have a bear market rally as it did in 1985-1992? On that dollar crash 1985-87 gold rallied but did not follow through when the dollar went even lower into 1992. That gave the world the 20+ year bear market in gold.
However if one takes a deflationist’s point of view, the whole 8 year dollar up and down cycles thing is out of the window and the dollar can rally to 160+, breaking out of its last 45 years of trading. That is not bullish for gold.
I don’t care about Elliott Waves because you can count them any way you want.
“However if one takes a deflationist’s point of view, the whole 8 year dollar up and down cycles thing is out of the window and the dollar can rally to 160+, breaking out of its last 45 years of trading. That is not bullish for gold.”
Absolutely true.
But should we take for granted that US (and many other) governments will accept this hyper-deflation scenario?
Will Trump wait for this nightmare(especially for his government) without trying to create more and more debt?
He wants to get back lots of jobs that went abroad,will he be able to do that with a super dollar?
“I don’t care about Elliott Waves because you can count them any way you want.”
Absolutely true again,but we just have the bull from 1970 to 1980 as a guide to try to understand if we still are in a bull market.
The bull market from 1970 to 1980 was formed by THREE MAJOR waves,if the correction from 1000 to 680 of the most recent bull was a MAJOR TWO ,I say it again,probably the bull is over.
If DXY goes to +160, you can kiss everything good bye. Its Mad Max world and a barter economy, which is what is happening in India right now.
“I say it again,probably the bull is over.”
Why bull is over at major three in 2011??
Elliott Wave counts five waves for the bull market. If major two was at 681 in 2008 and three was in 2011 at 1923 and now the corrective wave iv is down 55% The final fifth wave is yet to come????
Which can be equal to Major wave I 25 times).
Expected bottom now is 1104 to end this correction.
This is a Great thread fellows.
Excellent points being made , and the respect shows through
Thanks Mamare …excellent post and detail of the pertinent points .
Thank you Fully,much appreciated 🙂