Silver Poised for Multi-Month Low; Gold Leading Projected Surge into July 2019. June/July = Bullish Period (into July 15 – 22).
Silver Poised for Multi-Month Low; Gold Leading Projected Surge into July 2019. June/July = Bullish Period (into July 15 – 22).
05/18/19 Weekly Re-Lay: “Silver is close to fulfilling its weekly & monthly trend signals, ushering in the potential for a multi-month low…. Gold & Silver remain mixed with Gold leading intermediate rallies while Silver leads intermediate declines. That has been the case for several years (back to ‘11) and was again described in the Feb. 20, ‘19 Gold & Silver 2019 – Cycle Crescendo? when Silver (& Gold) signaled a multi-month peak.
The latest reversal occurred after Gold rallied into May 13/14 – when another multi-day high was forecast, the latest phase of a 12 trading-day low-high-high-(high) Cycle Progression. That fulfilled short-term analysis from the 5/11/19 Weekly Re-Lay – explaining why Gold’s daily 21 MAC and 21 MARC placed it in “the optimum position for a quick, accelerated advance”… into a May 13/14 peak.
Gold was expected to set a peak in the beginning of the week and a low at the end of the week, before embarking on a second rally…
While Gold was peaking, Silver was increasing the odds for a drop to new intra-month lows – as part of a larger-degree potential for a drop back to its Nov. ’18 lows (based on its weekly & monthly trend patterns). It has remained weak and in an intra-year downtrend since late-March and could not turn its intra-month trend up, when given a prime opportunity (May 3 – 8) – projecting more selling.
As Gold’s daily cycles were portending another high (May 13/14), Silver had entered a 3-week period when its inversely-correlated weekly 21 MARC was surging – placing added negative pressure on the price of Silver. It’s May 13 spike low had turned the weekly 21 Low MAC down, corroborating this bearish influence, and Silver was already trading well below that channel.
However, it is the broader context that is most important for Silver as this ‘weaker sister’ of Gold is poised to set new 3+-year lows (if it drops below 14.175/SIN – its Nov. ’18 low) and approach its 5 – 10 year lows (from late-2015). To understand that, a trip back to Nov. ’18 (and Feb. ’19) is necessary…
In 3Q/4Q 2018, Gold, Silver & the XAU reinforced their divergent ways with Gold bottoming in Aug. 2018 – fulfilling the latest phase of its 27 – 29 week cycle and the midpoint of its 55 – 59 week cycle and the XAU bottoming in Sept. 2018, while attacking its ~2-year downside target (55 – 59.00/XAU). That downside target was due to the monthly trend.
In an ironic twist, Silver extended its losses into Nov. 2018 (Gold was leading the overall reversal higher by bottoming in Aug. ‘18), at which time it spiked to a new multi-year low, fulfilled diverse weekly cycles, and turned its monthly trend down on Nov. 30. That trend signal projected a multi-month reactive bounce to begin in Dec. 2018.
Silver initially rallied into early-Jan., twice neutralizing its weekly downtrend but not turning that trend up. It later rallied to new highs in late-Jan., again failing to turn that weekly trend up. Finally, it retested its late-Jan. high – on Feb. 20 – and again failed to turn the weekly trend up. A 2 – 3 month reactive bounce was complete.
At the exact same time, Silver failed to even neutralize its monthly downtrend and similarly failed to turn its daily trend back up (after dropping into mid-Feb., turning the daily trend down, and then seeing a reactive bounce to decisive resistance while twice neutralizing that daily downtrend).
The Feb. 20, 2019 Alert discussed that and was echoed in the Feb. 20, 2019 INSIIDE Track – Gold & Silver 2019 – Cycle Crescendo?:
At the same time, Silver retested its high (16.20/SIH) while twice neutralizing its daily downtrend… this is as high as Silver should surge IF it is a ‘b’ wave rally prior to a ‘c’ wave decline (as is suspected). That would provide a textbook divergent top – with Silver peaking at or below its previous high as Gold sets a new (higher) high.
Silver has just spiked up to 3 of its latest 4 weekly LHR levels (extreme upside target for this week at 16.025 – 16.260/SIH) – in the 2-day period when the daily LHR portends a top (Feb. 19/20) – reinforcing it is at a DECISIVE level…
The Weaker Sister
It was not until mid-Nov. – the next phase of the 13 – 14 week cycle following Gold’s low in mid-Aug. – that Silver finally completed its downside objectives and signaled a similar bottom. That completed a myriad of cycles (a couple of which are illustrated on page 4) and set the stage for its own ~3-month advance.
Silver surged for the ensuing 7 weeks – into early-January – creating a 7-week low-high-(high) Cycle Progression targeting a future peak for Feb. 19 – 22, 2019. Like Gold, it also peaked at the midpoint of that cycle – in late-Jan. – increasing the synergy of cycles projecting an ensuing high on Feb. 19 – 22…
So, Feb. 19 – 22 is the period with the greatest synergy of all these cycle highs!…
Silver remains in a weaker position and has been unable to reverse its weekly trend up during this entire advance. So, that could be the leading metal if/when a downturn is signaled. It has spiked up to multiple weekly LHR levels (3 of latest 4 are at 16.025 – 16.260/SIH) – reinforcing that Silver is at an extreme level from which a new decline is likely.
…3 – 6 month & 6 – 12 month traders & investors could have entered long positions in Silver (futures, cash, ETFs, etc.) in late-Nov. at ~14.40 and be holding 2/3 of these w/avg. open gains of about $8,000/contract (in futures).
The first 1/3 should have been exited in late-Jan. around 15.90/SIH w/avg. gains of about $7,500/ contract. Exit/take profits on another 1/3 of these now and use a weekly close below 15.445/SIH as the trigger (risk) to exit the remainder…
The March 2019 INSIIDE Track elaborated on the more negative outlook for Silver and its potential to drop back to the Nov. ’18 low:
Based on Silver’s weekly trend pattern – which was unable to turn positive during the rally into Feb. 20 – it could even retest its Nov. ’18 low before the next bottom forms…
3 – 6 month & 6 – 12 month traders & investors could have entered long positions in Silver (futures, cash, ETFs, etc.) in late-Nov. at ~14.40 and be holding 1/3 of these w/avg. open gains of about $5,500/contract (in futures). The first 1/3 should have been exited in late-Jan. around 15.90/SIH w/avg. gains of about $7,500/contract.
The second 1/3 should have been exited on Feb. 21 around 15.90/SIH w/avg. gains of about $7,500/ contract. Exit the final 1/3 on a weekly close below 15.445/SIH. If this is triggered on March 1, wait until a retest of the lows to re-enter longs.”
Ever since the Feb. 20 peak, Silver has been steadily fulfilling this larger-degree outlook – based on both its weekly AND monthly trend patterns – and is approaching an important crossroads.
With Silver now nearing this pivotal support and downside objective, it is important to place all of this in proper perspective – in the context of the daily & intra-month (down) trends, the weekly trend and the monthly trend. All three are converging in the latest sell-off. And, all three could usher in a new rally once they are all fulfilled.
Meanwhile, Gold is holding above its April low after initially dropping to its 1 – 2 month downside objective (a spike below 1270.0/GC…
The XAU spiked down to monthly support at 65.85 – 67.30 and its weekly 21 Low MARC (66.59/XAU) and managed to close slightly higher on the week. That maintains the potential for this Index to rebound to a lower high (potentially ~72.00) into late-May. A daily close above 68.90 would be the first indication a low is forming.
This past week was 180 degrees/6 months from the Nov. ’18 low in Silver and secondary low in Gold & XAU… a prime candidate for a 1 – 2 month low.”
Gold is reinforcing signs of a bottom and the onset of a new surge into July 2019 (with the XAU capable of stretching a corresponding advance into August 2019) as Silver preparing for a major bottom and subsequent rally to new intra-year highs.
3 – 6 month Gold traders were recently triggered back into long positions near 1270.0/GC in preparation for a new, potentially accelerated rally into July 2019. Gold’s ~7-week (and 14 & 21-week) projects overall rally into July 15 – 22, 2019.
How Does This Impact Overall Outlook into late-2020?
Refer to latest Weekly Re-Lay & INSIIDE Track publications for additional details and/or related trading strategies.