Loading ...Gold in A$ as proxy for GDX
I use Gold priced in A$ as a proxy for GDX/gold forecast since it is closely related to revenue of the 93% of non US producing mines.
If the H&S pattern shown is correct we should return to the support line. Allowing for interim weakening of the A$ to say .77 then the forecast for Dec/Jan gold price would be say $1347*.77=$1037
If we are forming the right shoulder of a smaller H&S now under the ascending trendline the target would be about $1150. I think this is more accurate since there are no spikes in the data.
Invalidation points are marked should the earnings picture change
The last time Gold was $1140US the $AUD was 0.715 Dec 2016. The $US Index was somewhere around 103 Dec 2016 if I understand your post correctly that you imply Gold is heading to $1347 AUD ($1150 US)? I would expect you anticipate the $USD going to 103+/-?
IMO after the sabre rattling of the US is over (when the debt limit is increased in Dec) Europe and Japan are raising rates and the $USD could be back to it’s usual trend for 2017.
I like hearing points of view 180 degree from mine.
Thanks for your thoughts Ranchida
If the downward trend develops I expect a quick move to 1555-1560 A$. That is the point where I would sell Dust and reload after a bounce in gold. $1347 AUD is probably the extreme low for the move. It could finish higher and smaller more recent chart patterns should help determine a more accurate final low.
One thing the chart shows you is where miners tend to close off hedges.
I’m viewing this as a 2-3 month play. After that I will be looking for a big move up in gold.
Where do you see the the $USD during this move?
I just posted a chart to show the $USD structure short term. IMO either the low is in and we don’t go below 92.29 now or there is one final low to come and 89.6 would be the lowest possible target to maintain the structure. Longer term if the USD/JPY trendline breaks then the likely target is 127 i.e. a 12.3% appreciation putting the index around 104/105 say