PMs In 2020 – Great Expectations
Things are slowly becoming clearer in terms of this PM bull market, and its intentions. The evidence so far…
- We have formed a very clear and well defined base, with a low of approximately $1050
- We have since risen around 50% via a series of bullish chart patterns, each of which I have posted about in real time
- COT data, technical indicators and fundamentals have all provided a clear prediction that this was going to happen, and now indicate an assault on overhead targets, leading to new highs
My personal opinion (supported by the following charts) is that we will shortly break through $1550 resistance, leading to a new high for this bull, somewhere between $1750 and $1900 (probably just above $1800 if I had to be more precise). All of this is likely to occur within the next 3-6 months. My recommendation would be to exit all positions at that point, in anticipation of a pullback, close to current levels.
The mining indices (HUI, GDX, GDXJ) are likely to gain close to 100%, with silver and silver miners over-performing
So, good times ahead, followed by an opportunity to exit, and then re-enter at lower levels, ready for the next big move which will be the break to new all-time highs next year.
My second chart below, shows a roadmap with a perfectly sensible, reasonable, angle of ascent (the same as last time) into the bull market peak in the late 2020’s or around 2030.
As with any forecast, this will all need to be kept under constant review to make sure we’re not about to take a different path. There are many possible future outcomes, but this (in my view) is the one with the highest probability.
Fully… PIN this post now! Great plan Northstar.
Thanks for the kind comment Patrick 🙂
Why do you suspect a big move and then big pullback all within 3-6 months?
(The idea seems quite plausible to me–I just am wondering about details your thinking. I personally would **guess** a smaller yet dramatic move upwards in the next several months followed by a partial pullback–but I would not be able to justify my guess.)
Fair question Karl. I’ll put up another post to answer that soon.
Happy New Year, NS, all. I wouldn’t want to guess about the depth of a future pull back but I like the fuzzy math 🙂
Happy New Year to you to AM 🙂
What I can add on pullbacks is that in the strong uptrend we had from 2009-2011.. gold stayed within 15-5% of it’s 12 month moving average.. with 2 peaks above 20%. If we are to resume a similar incline, then it all depends how far we stretch.. how fast.. where we might hit important resistance (+how stretch will we be from MA?)… then.. which important resistance turned support we think will hold (+how close will we be to MA?)… calculate where we will be in regards to the arc’s right hemisphere outline (which acts as IMPORTANT support… I might be over thinking things.
Not over thinking at all Patrick – all very good things t0 keep an eye on. By examining very carefully how the bull market behaved in the past we can get some good clues what to expect this time. Also some good, early indications if things should start to go ‘off course’. Enjoying your work here and on Twitter 😉
Somehow your targets don’t add up NS. Not sure on you exact timeframes but you recently stated you expect the $US to go to 70 for an approximate loss of 38% (97 to 70) of value, yet Gold to only increase in value 24% (1530 to 1900). Either the timeframes aren’t linear, the values aren’t correct or you are suggesting Gold is going to lose 14% in value?
IMO Au needs to reach in excess of $2100 just to maintain its current value if the DXY falls to 70 in the same 3-6 month timeframe. Am I incorrect in your recent comments suggesting a target of 70 on the DXY?
I like your target of 1800 and the $US at or above 90. Equals about a 9% gain in the value of $Au in the next 3-6 months? I see relatively strong support for the DXY at 91.3 in the next 3-6 months.