Correction: How Deep?
I don’t believe the new Cyclical Bull Market in Gold is over, but there could be further downside. A very, very smart Canadian has some interesting information on this and I’ve attached a PDF he published four days ago. His work isn’t cheap (good chart-work never is!) but it has proven to be some of the best money I’ve ever spent.
This PDF was published 17 days ago where he indicated an Exhaustion Alert calling for a high and correction. Here he advised buying a drop to the 20-Week EMA.
The next chart contains the two moving averages he discussed as buy points. Each is significantly lower that today’s low, but since they’re rising the buy points should, too.
This chart shows that while pessimism toward Gold has certainly declined, there is no premium being paid to own these two ETFs. If the past is prologue we’re quite a way away from “Bubble City”.
This last chart is one I’ve posted before and it continues to show the odds being that Gold is in a new Cyclical Bull Market. While I’m mainly a technician I don’t ignore “funnymentals”. What could set gold back to the 40-Week SMA? How about a REAL vaccine and a Trump victory in early November? Even that won’t stop the massive money-printing but it could definitely slow the Bull down for three to six months. (However, it’s best to follow Rambus for determining Bull Market status!)