“In part 1 of this Weekend Report I’m going to show you why I believe the PM complex is currently trading at an important inflection point. An inflection point is an area on a chart where the price action can break hard in either direction. This area is critically important to know before hand so you can act in time before to much damage is done to your portfolio.

Some of these charts to follow I originally showed you back in September of last year shortly after the small double top showed up on most of the PM stock indexes. At the time I was strongly suggesting that it was time for the PM complex to form a bigger consolidation pattern to consolidate the recent gains that could be bigger than any of the previous small consolidation patterns since the September 2018 low.

If you recall the price action on most of the PM stock indexes had rallied all the way up to their August 2016 high before correcting that massive impulse leg forming the 2016 bullish falling wedge. That August 2016 top marked an important high that will need to be overcome before the bull market can continue.

That is how markets work. An old important high will generally act as resistance when it is initially hit down the road. If the bull market is strong then there is usually a smaller consolidation pattern that forms just below that old important high, that gives the stock the energy it needs to finally breakout and move into new high ground. On the other hand an old important high can mark an area of resistance that is not easily overcome and will turn the stock back down to the bottom of its trading range before another rally attempt is made at the old high. The worst case scenario is when the price action fails to take out the old high forming a reversal pattern.

Please keep in mind when you look at the charts to follow that the infection point is just that, where there is no confirmation one way or the other on which direction the price action is going to take. It is also important to keep an open mind which is very hard to do for most investors. I don’t have to tell you that most analyst in the PM complex have been very bullish for quite sometime which has been correct. Now that the PM complex appears to be at an important inflection point from a Chartology perspective, how many analyst will be able to switch gears and call for a possible deeper correction in time to save their portfolios?”

I’m going to focus on the GDX as a proxy for the rest of the PM stock indexes. We’ll start with the shorter term daily charts and work our way out to the very long term charts so you can see the big picture which is really where the important inflection point is found. Each chart will add a piece to the puzzle that hopefully can help keep our hard earned capital in tact

For Members

https://rambus1.com/2020/01/19/weekend-report-important-inflection-point-for-the-pm-complex-part-1/

“The beauty of Chartology is that you can see potential problems brewing in the future before they finally reveal themselves. I want to make it perfectly clear at this time that this theme is only a possibility until we get more information. The PM complex will talk to us whether we want to listen or not. Having an open mind to what the markets give us is important to take advantage of their ever changing investing environment.

In Part 2 of this Weekend Report we are going to look at some important currencies of the world that will help give us some confirmation, one way or the other, on which direction the next important move in the PM complex may take. All the best…Rambus”