Gold, Silver, XAU Correcting
02/27/16 Weekly Re-Lay: “Gold & Silver are moving lower – on balance – since fulfilling decisive 4-Shadow upside price objectives on Feb. 11th. At the time, Silver completed a 3rd successive, ~2-month rally of ~2.40/SI w/out turning its weekly trend up – opening the potential for a drop back to its lows.
The multi-month advance – from the low & corresponding buy signals in mid-Dec. into mid-Feb. – provided convincing validation to ongoing analysis that 2016 would be The Golden Year, beginning with a powerful surge in Gold & Silver. That sets the stage for what is now even more likely to unfold in 2016.
Of course, markets do not go straight up or straight down which is why these signals were needed to provide dual fulfillment – of what is expected now and of what is expected to follow.
With Gold & Silver surging to monthly & weekly LHR levels, it showed they had pushed to their upside extremes and needed to spend some time digesting that new-found strength before embarking on their next leg up.
That is why any ensuing rallies (after Feb. 11th) were expected to lack any ‘convincing follow-through to the upside, in the near term’…This increases the focus on March 7–11th, when Dollar cycles are projecting a peak and when Gold & Silver cycles portend the next low.
However, the price action leading into and out of that cycle are crucial since Gold has an even more intriguing & synergistic weekly cycle coming into play on April 4–8th & April 11-15th.
From all appearances, that (~19-week) cycle should also time an important low. The question will be whether it pinpoints a low that is higher or lower than the preceding (anticipated) low on March 7–11th. Gold’s daily AND weekly trend patterns should help to clarify that.
Silver is corroborating that potential with a 16-week high-low-low-(low) Cycle Progression that also projects a low for April 4–8, 2016. Its recent, 8-week surge took Silver higher into the mid-point of that cycle.
An overriding 31–32 week high (Jan. ’15)–low (Aug. ’15)–low Cycle Progression also comes into play on April 4–8, 2016 (and the preceding week) in Silver.
So, the next 4–6 weeks could be an interesting time for precious metals, when more volatile consolidation is likely. It would only be after that period – beginning in mid-April – when a greater consensus of cycles & indicators would be primed for another significant advance.
3–6 month & 6–12 month traders and investors should have entered long positions in Gold & Silver in mid-Dec. (at ~1046–1076/GC & 13.62–13.88/SIH) and should…[reserved for subscribers only]…
The XAU has surged since intermediate cycles bottomed on Jan. 19th. It finally gave a weekly close above 60.76/XAU – turning the weekly trend up (a lagging & confirming indicator) and confirming a multi-month bottom. That signal often pinpoints the peak of the first leg up and ushers in a significant correction.
The XAU has created a ~90-degree high (Oct. 16th)–low (Jan. 19th)–low (April 16–19th) Cycle Progression that reinforces some intriguing possibilities for the days surrounding April 19th – the Date of Aggression (formerly referred to as the Date of Infamy).
While that does not discount the potential for additional highs in the interim, it does show that a very important (secondary) low should take hold at that time.” TRADING INVOLVES SUBSTANTIAL RISK. See Hypothetical Trading Disclaimers.
Gold, Silver & XAU focusing in cycle lows in middle half of April 2016. Intervening highs remain possible before then. Early-March cycle lows should spur new rally.