Gold Stocks Reinforce Bearish Outlook
Gold Stocks Reinforce Bearish Outlook;
Overall Drop into March 7 – 9 Expected…
Price Action Confirms Late-Jan. Sell Signals.
02/17/18 Weekly Re-Lay:
“Gold & Silver rallied sharply after fulfilling daily cycles that projected a low around Feb. 9, the latest phase of a ~60-degree/2-month high-high-low-low-low-(low) Cycle Progression.
Gold remained positive throughout that correction, dropping right to its retracement target – a decisive range of support & downside targets at 1309.3 – 1316.3/GCJ that included the 2017 low, the determining factor for the intra-year trend.
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.
Meanwhile, Silver (and the XAU) displayed relatively & proportionately greater weakness – during the Dec. – Jan. rally and the ensuing decline. It turned its weekly 21 MAC down on Jan. 22 – 26, signaling a top & projecting a new wave down, and then quickly turned its intra-year trend down.
Silver has reinforced that intra-year downtrend for three consecutive weeks, projecting a likely drop back to its Dec. low around 15.60/SIH…
Silver already lost more than 75% of its Dec./ Jan. advance – taking it to its extreme retracement point (.786 – the 2DGR). A daily close below 16.13/SIH would increase the likelihood for a drop to 15.60/SIH in the coming weeks.
The XAU rebounded after dropping to its 1 – 2 month downside target and reaching it sooner than expected (but in line with cycles projecting a multi-week low on Feb. 8 – 9). It rallied sharply enough to get within a few ticks of its weekly LHR– at 86.17/XAU. It did that while neutralizing, but not turning up, its daily downtrend…Until that occurs, there remains a strong chance for another decline in the coming weeks(s).
On a weekly basis, the XAU just achieved last week what it did on a monthly basis in January.
It rallied to its weekly 21 High MAC while remaining below its weekly 21 High MARC (leaving that channel heading lower). It finished the week, reinforcing its intra-year downtrend.
This is corroboration to the overall outlook for the Dec. – March 2018 period, beginning with a projected surge to 92.87 – 93.06 followed by an expected drop into Feb. 8 – 9.
That was expected to produce an initial 1 – 2 week low and an ensuing rebound, before another drop into an intermediate low in early-March.
That is the next phase of a 90-degree/3-month high-high-low-(low) Cycle Progression and a 360-degree move from the early-March 2017 bottom.
On a little more precise basis, the XAU has perpetuated this 90-degree and an intervening 30-degree cycle with uncanny consistency…
Since the Sept. 7 peak, it has created a high (Sept. 7 – 9) – high (Oct. 7 – 9) – high (Nov. 7 – 9) – low (Dec. 7 – 9) – low (Jan. 7 – 9) – low (Feb. 7 – 9) Cycle Progression that projects the next multi-week low for March 7 – 9, 2018.
…and that was all preceded by a high (Jun 7 – 9) – low (July 7 – 9) – low (Aug. 7 – 9) Cycle Progression.
The key (larger-degree) turning points create the 90-degree/3-month high (Jun. 7 – 9) – high (Sept. 7 – 9) – low (Dec. 7 – 9) – low (Mar. 7 – 9) Cycle Progression that is being monitored for the next intermediate low.
And that Progression was preceded by a low on March 7 – 9, 2017.
So, there is also a 360-degree/12-month low – low cycle at work – projecting a low on March 7 – 9, 2018.
Right now, a test of [reserved for subscribers] is the primary downside target for that time frame. If that level is tested sooner, or if intervening indicators alter that, it will be conveyed.”
Gold stocks (XAU) are precisely adhering to outlook for Dec. – March 2018, completing the projected rally into late-Jan. & initial decline (following the Jan. 25 – 26 sell signals) into Feb. 9. Their latest rebound corroborated that outlook and projects another drop into March 7 – 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.