In Tuesday's blog on gold, I wrote:
"The current correction is falling right into the center of a reversal zone specifically for the precious metals (Nov. 2 - 15) and it has already fallen below the 15-day moving average. A bottom could be imminent. Prices could go as low as $1900, but because this market looks bullish, they may not go that far down. A good target could be anywhere between the 15-day and 45-day moving averages, i.e. between $1920 - $1980 (today prices got to $1957). Thursday and Friday are strong potential "pivot points" for gold, so we may see a bottom then. We will watch for a buy spot this week..."
Well, today is Thursday - a possible "pivot point" for gold, and we are still near the center of our reversal zone for precious metals (Nov. 2 - 15). Today prices made a new weekly low at $1945 but seem to be finding a support line at $1950. This looks like a good spot to buy. Let's enter a long position in gold now. We can set an initial stop loss for this trade just below the 45-day moving average (around $1922). Silver may also be bottoming now, but it is below both its 15-day and 45-day moving averages, so it's possible it could fall lower. Let's hold off buying silver for now.
Today the broad stock market was holding its breath waiting for Fed Chairman Jerome Powell's speech at 2 pm this afternoon. In his speech, Mr. Powell said that more interest rate increases are still a possibility. Apparently Wall Street was not expecting such hawkish rhetoric, and equities are tumbling on this news. Of course, our technical and cycle analysis (sub-cycle top in a strong reversal zone with bearish divergence) was predicting this, and we can breathe at least a temporary sigh of relief for our short position in this market (which we will keep for now).