Gold & Silver Project Sequence of Higher Highs in 2020/2021!
04/25/20 Weekly Re-Lay: “Gold & Silver have corrected since fulfilling analysis for rallies into mid-April…
Silver remains focused on the next phase of the 7-week high-high-low-(low) Cycle Progression that helped pinpoint the March 16 – 20 low. Silver is expected to set a secondary low on May 4 – 8, the next phase of that 7-week cycle.
Several readers have asked if this latest peak in Gold fulfills what was projected in mid-March and what has been discussed for 2020 – 2021 – regarding a succession of ‘5th’ wave advances.
Some of the longer-term outlook will be reserved for separate publications but there are some critical aspects of that which need to be addressed now.
In order to answer those questions, some context is necessary to be able to illustrate what has – or what has not – been fulfilled… and what remains unfulfilled. So, I’ve added a couple pages to be able to accommodate this analysis…
From a multi-year perspective, 2020 – 2021 has been forecast to be the opposite (flipside) of 2016 – 2018 – from a wave perspective.
This has been illustrated many times and involves a contrast to the series of ‘1-2’ moves that unfolded in 2016 – 2018. Those ‘1-2’ moves refer to a wave ‘1’ rally followed by a wave ‘2’ decline that bottoms at a higher level.
As Gold’s uptrend began to gain momentum, that series of ascending ‘1-2’ waves (rally & decline followed by new rally and decline to higher low followed by new rally and decline to higher low – what is sometimes referred to as a ‘1-2, 1-2, 1-2’ in Elliott-Wavespeak) gave way to strong rallies.
That led to analysis for a series of wave ‘5’ culminations beginning in early-March ’20 – a series of ‘4-5’ wave sequences.
That Mar. ’20 high was forecast to complete the 5-wave structure from the late-2018 low, while only representing the wave ‘3’ of a larger-degree advance (since each larger-magnitude impulse wave breaks down into 5 lesser-degree waves within that overall rally).
When discussing expectations for early-March ’20 to time the peak of an initial ‘5th’ wave rally, it was repeatedly stressed that that ‘5th’ wave would only be the first of a series of higher highs that would represent successive wave ‘5’ peaks – each being of one magnitude higher than the one before.
This pattern could stretch into May 2021.
When discussing the 2 – 4 week outlook for Gold, the latest peak, decline, and rally are the focus. When Gold fulfilled its upside targets in early-March ’20, it was forecast to plunge to ~1450.0/GC – the ‘4th wave of lesser degree’ before the larger-magnitude advance could resume and propel Gold to new multi-year highs.
It did just that, plummeting to 1450.9/GCJ while maintaining a bullish weekly trend structure. The XAU did the same thing – also reaching major downside targets and signaling a bottom at 6 – 12 month support (even as Silver continued to diverge).
While Gold & gold stocks were fulfilling decisive downside price targets, Silver was fulfilling a myriad of weekly cycle lows – on March 16 – 20. The overall stock market was doing the same thing, reinforcing the potential for gold & silver stocks to bottom as well as the metals – spurring a decisive buy signal in metals’ stocks.
The March 18, 2020 Weekly Re-Lay Alert highlighted that and was titled: “The Week for a Low… in Stocks & Silver”…
Not only were multi-month bottoms expected, but Gold and the XAU had fallen fast enough to prevent their weekly trends from turning down. That projected rallies to new multi-year highs – the next set of wave ‘5’ rallies in this developing structure…
The XAU has recently closed at new ~7-year highs – signaling that this is a higher-magnitude impulse wave, still expected to last into late-2020 or early-2021.
So, any pullback into mid-May would likely produce another buying opportunity. (Of added interest, the HUI or Gold Bugs Index rallied right to its 2016 high but has not yet exceeded it.)
This latest phase, since mid-March, has been the best-case scenario where stock market cycles (bullish from March 16 – 23 bottom into mid-April) coincided with multi-month cycle lows in metals (March 16 – 20) – when Gold precisely fulfilled the downside objective needed to usher in a new, higher-magnitude wave ‘5’ advance.
With stock cycles AND metals’ cycles rallying, downside price objectives fulfilled, and wave structure projecting an ultimate rally to new highs – the synergy of bullish factors has been enough to propel the XAU to its next level.”
Gold, Silver & XAU Index (Gold/Silver Index) confirming new bull market after bottoming in perfect sync with multi-month cycle lows on March 16 – 20. That was/is projected to spur new advances into late-2020 and likely into May 2021 with Silver gains likely exceeding Gold gains during that period.
Secondary low projected for May 4 – 8 as Metals reinforce outlook for accelerated advances into late-2020/early-2021.
How Could Could Sequence of Ascending Highs Take Gold (and Silver) into 2021?
Refer to latest Weekly Re-Lay & INSIIDE Track publications for additional details and/or related trading strategies.