Gold – Evidence Suggests A Move To The Old Highs Is Imminent
Chart first, then I’ll explain how I’m interpreting it…
1 – The ‘arc’ is complete. All that remains is the final surge to touch the old highs.
2 – The 8 year cycle is clear and the next low is due anytime from around late 2023 (when does the descent into that low begin ?)
3 – The volume indicator (doesn’t matter how it works) – blue and red lines oscillate, but don’t really cross in a bull market.
4 – The volume indicator is approaching the extreme prior to a major pullback, but the red line hasn’t quite hit the ‘extreme zone’ yet.
5 – MACD is in long term bull mode
6 – Stoch hasn’t quite hit the red line associated with bull market interim peaks, but it will soon
Putting all of this together, along with current sentiment and fundamentals, leads me to believe we have the conditions suitable for a final push to the old highs. I think we’ll arrive there with very stretched indicators suggesting a sizeable consolidation/pullback is likely. I expect the bears to come out (yet again), with calls for $1000 (yet again). They will be wrong (yet again). It will be a great time to take profits and sell many positions if you want to, knowing that you can get back in at lower levels.
I know some are expecting the move to just go straight past $2000 and head towards $2500/$3000 without any major pullbacks. At this point, I don’t think that is the most likely outcome. I wouldn’t say it’s impossible though, just unlikely.
Do you think that gold will correct between now and the beginning of May?
Not in any meaningful/tradable way. I think the daily cycle low is behind us now. I could be wrong of course, but GDX has entered a pretty ‘thin’ zone and is likely to ‘reverse symmetry’ back up. The proverbial beach ball which has been held under the water.
Thanks. I usually lose trying to trade, but I can’t help it.
Last week I believe gold touched $1655 – or was it Monday? Anyway, when gold reversed from there, I “assumed” that we were going up based on your target of $1650. It is, after all, a bull market and the stocks had held up pretty well. At any rate, I took a few small positions with calls on Monday, added more on Tuesday, went full bore yesterday. I have a small account I call my “travel” account. I have always hoped to make enough profit in the account to fund some travel for me and the precious wife. Almost got wiped out during the winter…but not quite. Today, that little stinker is up 75%. Never thought I’d see that…but it is, after all, a bull market.
Thanks for all of the fine work you post, Mr. Meteorman!
Glad to hear you’re doing well Silverboom. I’ve tried to trade in and out a couple of times recently (including this daily cycle low). The miners barely pulled back far enough to make it worth bothering. I guess I came out with a very small profit. I got back into Uranium a little while back and that’s been making up for past errors (up well over 100% in a few weeks). I took a chance and risked about 25% of my savings on it, and I’m glad I did. The supply crunch has pushed spot uranium up, which along with other factors, should ensure a very good rally in the next year or two – perhaps another 300%+.
Well, that was the shortest-lived hurrah in living memory…
Ideally would be a rund to GDX 40, correct back to GDX 32 to test outbreak level and then back up to gdx 50+
That’s what I’m seeing too Alex. Looking out for the next daily cycle low.