GOLD AND SILVER UPDATES (9:00 pm EDT)
We can now confirm that gold's low of $1812 on Oct. 6 was the end of an old medium-term cycle and the start of a new one. The previous cycle's trend was bearish (it ended lower than where it started), and that could mean this new cycle will be bearish, but it doesn't have to be. In fact, last week's steep rally is suggesting the trend could be turning bullish. It will take a close above the high of the last cycle - $1987 - to confirm a bullish trend, and this isn't too far away.
We are now moving out of any strong reversal zones (they end today). Gold made an isolated high yesterday and is down a bit today, so a significant correction could be starting. But if gold pushes higher over the next several days, we will have to assume it is bypassing a normal reversal and is breaking out instead (this can happen in strongly bullish markets). Assuming prices correct down modestly over the next few days (say to $1900), we may consider going long as there are many bullish factors driving gold right now (i.e geopolitical tensions). Alternatively, if we miss a good buy spot we will stay on the sidelines and wait for the next major corrective drop. We are expecting a major crest in this new medium-term cycle anytime between now and mid-November, and a strong correction should follow. Nov. 11 looks like a strong possibility for the crest. If at any time gold falls back below $1812, we will switch to bearish strategies. We remain on the sidelines of gold today.
It is now clear that, like gold, silver started a new medium-term cycle last week with its low of $20.70 on Oct. 3. It's strong rally from there is also a bullish sign, but as with gold, we have to be careful here (silver's previous medium-term cycle trend was also bearish). We may look to buy on any modest corrective drops over the next few days. If silver remains bullish, it could still rally back up into the $27 - $35 range into the end of this year and early 2024. We are on the sidelines of silver for now.
We can now confirm that gold's low of $1812 on Oct. 6 was the end of an old medium-term cycle and the start of a new one. The previous cycle's trend was bearish (it ended lower than where it started), and that could mean this new cycle will be bearish, but it doesn't have to be. In fact, last week's steep rally is suggesting the trend could be turning bullish. It will take a close above the high of the last cycle - $1987 - to confirm a bullish trend, and this isn't too far away.
We are now moving out of any strong reversal zones (they end today). Gold made an isolated high yesterday and is down a bit today, so a significant correction could be starting. But if gold pushes higher over the next several days, we will have to assume it is bypassing a normal reversal and is breaking out instead (this can happen in strongly bullish markets). Assuming prices correct down modestly over the next few days (say to $1900), we may consider going long as there are many bullish factors driving gold right now (i.e geopolitical tensions). Alternatively, if we miss a good buy spot we will stay on the sidelines and wait for the next major corrective drop. We are expecting a major crest in this new medium-term cycle anytime between now and mid-November, and a strong correction should follow. Nov. 11 looks like a strong possibility for the crest. If at any time gold falls back below $1812, we will switch to bearish strategies. We remain on the sidelines of gold today.
It is now clear that, like gold, silver started a new medium-term cycle last week with its low of $20.70 on Oct. 3. It's strong rally from there is also a bullish sign, but as with gold, we have to be careful here (silver's previous medium-term cycle trend was also bearish). We may look to buy on any modest corrective drops over the next few days. If silver remains bullish, it could still rally back up into the $27 - $35 range into the end of this year and early 2024. We are on the sidelines of silver for now.
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