Gold Stocks Fulfilling Textbook Signal
Gold Stocks Fulfilling Textbook Signal;
Jan. Peak Reinforces Bearish Pattern…
Projected Drop into March 5 – 9 Unfolding.
02/10/18 Weekly Re-Lay:
“Gold & Silver have dropped sharply after Gold reached its ~2-month upside target (1365.8/GCG, 1370.0/GCJ) & Silver turned its weekly 21 MAC down on Jan. 25 – 26. That was expected to trigger a 1 – 3 week correction, which has unfolded, with daily cycles arguing for a low on Feb. 8 – 9.
The late-Jan. peaks completed the early-Dec. buy signals and ushered in the time for a slightly longer-lasting peak… & larger-degree correction. That was expected to involve a 1 – 2 week low being set around Feb. 9, the latest phase of a ~60-degree/2-month high-high-low-low-low-(low) Cycle Progression in Silver.
Gold was projected to drop to a decisive range (of support & downside targets) at 1309.3 – 1316.3/GCJ. That range encompassed 2 of the latest 3 weekly HLS levels, the 2017 closing level, the weekly 21 High AMAC, the monthly Raw SPS& the levels of previous highs in April, June & October – multi-month resistance turned into support.
Most importantly, it also included the 2017 low – the determining factor for the intra-year trend. That level is also at 1309.3/GCJ.
Gold dropped right to that support, fulfilling its initial 1 – 2 week downside targets, and closed the week at 1315.7/GCJ – initially holding that support. Gold should NOT give a weekly close below 1309.3/GCJ if it is to maintain its 2 – 3 month uptrend and be in a position to rally to new highs.
Silver, in contrast, remains more bearish – reinforcing its weekly 21 MAC downtrend while again neutralizing its weekly uptrend & reinforcing its intra-year downtrend. It has lost more than 75% of its Dec./Jan. advance and remains weak.
The XAU has dropped sharply after perfectly fulfilling its January (and 1 – 2 month) upside target at 92.87 – 93.06. That completed the projected surge from early-Dec. and attained the upside objective for this latest advance – providing ‘the ideal scenario for a multi-week top’.
Though daily cycles could produce an initial 1 – 2 week low at this time, weekly cycles are still arguing for the next multi-week low in early-March. That is the next phase of a 90-degree/3-month high-low-(low) Cycle Progression and a 360-degree move from the early-March 2017 bottom.
With the monthly trend, weekly 21 MAC and intra-year trend all down, the XAU was likely to head back toward 76.00 as it neared March. It has approached this target sooner than expected, reinforcing its underlying weakness.
As explained many times since 4Q 2016, the XAU reversed its monthly trend back down in Oct. 2016 and has never even been able to neutralize that, despite multiple 1 – 2 month rallies.
The three primary reasons that the XAU was projected to surge to 92.87 – 93.06 and hit that range in January 2018 was the potential to surge to its monthly LHR (extreme upside target) while testing & holding the convergence of weekly 21 High MAC and weekly 21 High MARC – a Perfect Storm of signs for a multi-month peak.
It did precisely that, surging to 92.94/XAU in Jan. and holding that very narrow range of upside targets & resistance zones while remaining below its Sept. ’17 peak.
In doing so, the XAU flattened its monthly 21 High MAC, which had been angling higher since 2Q 2017, while simultaneously testing that upper channel. That channel has already turned back down in February.
Combined with the prevailing monthly downtrend, that 21 MAC action projects an ultimate drop to (at least) [reserved for subscribers].
The HUI remains targeted for 158 – 160.0 (which also includes a multi-year HHL target).”
Gold, Silver & Gold stocks (XAU) have plummeted since the Jan. 25 – 26 sell signals, fulfilling analysis for an initial sell-off into Feb. 9. They are not, however, out of the woods since Gold stocks & Silver are projected to suffer an overall decline into March 5 – 9. A second stock market sell-off could be seen towards the tail-end of that decline – in early-March.
On a 1 – 2 year basis, XAU remains much weaker than Gold and could dive back towards its ultimate downside target as it drops into early-March.
See Weekly Re-Lay & INSIIDE Track for additional analysis and/or trading strategies.