Gold Signaling 6 – 12 Month Low; XAU & Silver Should Follow.
Gold Signaling 6 – 12 Month Low; XAU & Silver Should Follow.
08/31/18 INSIIDE Track: “Gold & Silver remain in a multi-year consolidation that is considered to be a corrective rally following the 5-wave decline from 2011 into late-2015. The key for Gold is its Dec. 2016 low. That was, and still is, perceived to be the ’B’ wave low of an ’A-B-C’ wave rebound – capable of stretching into 2019 (or beyond; on its own, this wave structure does not pinpoint timing)
When Gold turned its weekly trend down, in early-May ‘18, it shifted the intra-year outlook more negatively and ultimately created a break below the Dec. ’17 low – a key level of 3 – 6 month support. That occurred as the Dollar was flexing its muscle and rallying more convincingly from its Feb. ’18 low. Throughout 2018, Dollar stability has been a negative for Gold, with Gold peaking a couple weeks before the Dollar bottomed.
In late-Jan. ’18, Gold fulfilled 27 – 29 week and 55 – 59 week cycles that projected a future peak for March 2019 (with an intervening phase of the 27 – 29 week cycle arriving in August 2018). Gold has sold off into that cycle – also the midpoint of the 55 – 59 week cycle – the same time that Copper could be producing a multi-month low…
Silver remains in an intra-year downtrend as it has for all but one single week since early-Feb. After breaking below 16.00/SI, Silver ushered in the potential for a drop to ~13.50/SI – the continuation of a pattern (moving in 2.50 point ranges) that has evolved for the past 4 – 5 years…
The XAU has continued to decline into Aug. – Nov. 2018 – when a 3 – 6 month or longer bottom is likely. That would perpetuate a 30 – 34 month low (5/05) – high (3/08) – high (12/10) – low (6/13) – low (1/16) Cycle Sequence. At least one related cycle – a 48 – 52 week high-low-low-low-(low) Cycle Progression – could stretch a final low into Nov. 2018.
From a price perspective, the XAU has remained the opposite of Gold – since late-2016 – projecting a drop below its Dec. 2016 low (71.63) before it would even be in a position to mount a larger-magnitude advance. That was finally fulfilled in August.
Since mid-2017, related wave targets have focused on 54.00 – 59.00/XAU as the larger-degree 1 – 2 year downside wave targets that are now coming into focus. Until a weekly close back above 71.63, the XAU remains negative and could spike closer to those downside wave targets as the monthly trend remains solidly down (as it has since late-2016).
Platinum remains the weakest metal and could still extend its decline into 4Q/Oct. 2018 – when multi-year cycles converge. By dropping below its Jan. 2016 low, Platinum has created a ‘5th’ wave decline while testing its 2008 low near 760.0/PL – the lowest level of the past 14 years…
Palladium dropped sharply into mid-Aug. – completing an ‘a-b-c’ correction in which the ‘c’ wave equaled the magnitude of the ‘a’ wave. It did that while retracing 50% of the Jan. ‘16 – Jan. ‘18 advance – setting the stage for a multi-month bottom. Palladium has rallied and twice neutralized its weekly downtrend, needing a weekly close above 971.8/PAZ to reverse that trend to up.
Copper remains bearish but has initially fulfilled its expectations for 2018, during which a major (~6-month) decline was projected to correct its 5-wave advance from Jan. 2016 into late-2017. It accelerated lower , spiking down to its 4th wave of lesser degree target – on a contract basis – at 2.5480/HGU. It also doubled its 10-month trading range while spiking to that support.
That has been the downside objective since Copper reached its ~2-year upside target (3.2800 – 3.3000/HG) and peaked. Now that it has been reached, Copper is in a better position to begin tracing out a bottoming formation. Copper should not give a monthly close below 2.5745/HGZ if it is to remain in a constructive pattern.”
Gold, Silver & Gold/Silver Index (XAU) have declined since intermediate cycles peaked on June 11 – 15. A sequence of lows is expected in Aug. – Nov. 2018 – with Gold providing the first in Aug. ’18 (fulfilling its ~27-week cycle) and should usher in a new bullish period in precious metals – leading into late-Feb./early-Mar. ’19 (the next phase of Gold’s 27 – 29 week & 55 – 59 week cycles).
Gold stocks (XAU) remain on course for multi-year drop to ~59.00, where a secondary low is most likely. Cycles portend a 1 – 2 year low in the coming months, so price action is the key! See Weekly Re-Lay & INSIIDE Track for additional analysis and/or trading strategies.