How Metals Are Validating Cycle Highs… and Projecting Downside Into Nov. 8 – 16.
How Metals Are Validating Cycle Highs… and Projecting Downside Into Nov. 8 – 16.
10/31/18 – Weekly Re-Lay Alert: Gold & Silver turned their daily trends down, peaking a day before the ideal time for a top (Oct. 29 – Nov. 2) – the latest phase of a consistent 20-week high-high-high-high Cycle Progression in Silver.
They failed to add to recent gains, before reversing lower, showing new weakness sooner than expected and ushering in the projected drop into Nov. 8/9 – when daily cycles converge and portend a low.
This reversal is in sync with the weekly trend patterns and could allow for at least Silver to retest its low before bottoming. The new intra-month trends could help clarify what to expect in the next 1 – 2 weeks…
The XAU has dropped sharply after rallying right to its monthly LHR (the extreme upside target for October – at 71.46) while retesting its Dec. 2016 low (71.63) and reversing lower.
That level of support-now-turned-into-resistance has been a primary focus since early-2017. It took over 20 months to finally reach it and break through toward its primary wave target (54 – 59/XAU).
As is often the case, the first reaction (higher) from that initial test took the XAU right back to that previous support level (71.63) – a way of testing its significance. Since testing that, gold stocks have sold off.
The XAU’s downward reversal came right after it attacked its descending weekly 21 Low MAC – a combination of factors that created a multi-week peak. This also came right after the XAU turned its weekly trend up, the most likely time for an initial peak and subsequent 1 – 3 week correction.
This index is in the midst of the second week – of that 1 – 3 week correction – and has retraced to the levels of the late-Sept. and early-Oct. lows while turning its daily trend down. That support (~63.80/XAU) would need to hold to prevent a retest of the lows as part of this multi-month bottoming process.
From a slightly broader perspective, the weekly trend remains up until a weekly close below 63.75/XAU. A secondary low is likely on Nov. 9 – 13, the latest phase of a ~2-month/60-degree Cycle Progression, so it is conceivable that the XAU could neutralize its weekly uptrend (but not turn it down) as it moves toward that next expected low.
Copper has turned negative on a 2 – 4 week basis, ushering in the potential for a retest of its mid-Aug. low as part of a similar bottoming process.
Similar to the XAU, Copper could stretch this process out another 1 – 2 weeks with its next low likely on Nov. 5 – 16, the latest phases of both a 23-week high-high-(low) Cycle Progression and a ~16-week low-low-low-(low) Cycle Progression.”
Gold & Silver reversed lower (a day early), validating ongoing expectations for an intermediate peak and reversal lower during the current week. The XAU is leading the way and has already sold off after rallying right to a critical level of ‘do-or-die’. It projects an overall correction into Nov. 8 – 13. Copper is corroborating that outlook and could see more downside into Nov. 9 – 16.
Refer to latest Weekly Re-Lay & INSIIDE Track publications for additional details and/or related trading strategies.