Best of the Week
Most Popular
1. Climate Change Mass Extinction - Birds, Bees and Bugs: Going Going Gone - Richard_Mills
2.A Purrrfect Gold Price Setup! - Peter_Degraaf
3.Who Finances America's Borrowing? Recession Indicator for Independent Thinkers Part 2 - F_F_Wiley
4.America’s One-sided Domestic Financial War - Raymond_Matison
5.Gold Price Summer Doldrums - Zeal_LLC
6.Two Key Events Will Unleash Gold - Jim_Willie_CB
7.Billionaire Schools Teacher in NAFTA Trade Talks - Richard_Mills
8.Get Out Of Crypto Cannabis Bubble Before It Pops and Move Into Bargain Basement Miners - Jeb_Handwerger
9.Stock Market Could Pullback for 1-2 weeks, But Medium Term Bullish - Troy_Bombardia
10.G7 Chaos, Central Banks and US Fed Will Drive Stock Prices This Week - Chris_Vermeulen
Last 7 days
How Crazy It Is to Short Gold with RSI Close to 30 - 16th Jul 18
Markets Pay Attention Moment - China’s Bubble Economy Ripe for Bursting - 16th Jul 18
Stock Market Uptrend Continues, But... - 16th Jul 18
Emerging Markets Could Be Starting A Relief Rally - 16th Jul 18
(Only) a Near-term Stock Market Top? - 16th Jul 18
Trump Fee-Fi-Foe-Fum Declares European Union America's Enemy! - 16th Jul 18
US Stocks Set For Further Advances As Q2 Earnings Start - 15th Jul 18
Stock Market vs. Gold, Long-term Treasury Yields, 10yr-2yr Yield Curve 3 Amigo's Update - 15th Jul 18
China vs the US - The Road to War - 14th Jul 18
Uncle Sam’s Debt-Money System Is Immoral, Tantamount to Theft - 14th Jul 18
Staying in a Caravan - UK Summer Holidays 2018 - Cayton Bay Hoseasons Holiday Park - 14th Jul 18
Gold Stocks Summer Lows - 14th Jul 18
Trump US Trade War With China, Europe Consequences, Implications and Forecasts - 13th Jul 18
Gold Standard Requirements & Currency Crisis - 13th Jul 18
Focus on the Greenback, Will USD Fall Below Euro 1.6? - 13th Jul 18
Stock Market Outlook 2018 - Bullish or Bearish - 13th Jul 18
Rising Inflation is Not Bearish for Stocks - 13th Jul 18
Bitcoin Picture Less Than Pretty - 13th Jul 18
How International Observers Undervalue the Chinese Bond Market - 13th Jul 18
Stocks Trying to Break Higher Again, Will They? - 12th Jul 18
The Rise and Fall of Global Trade – Redux - 12th Jul 18
Corporate Earnings Q2 2018 Will Probably be Strong. What This Means for Stocks - 12th Jul 18
Is the Relative Strength in Gold Miners to Gold Price Significant? - 12th Jul 18
Live Cattle Commodity Trading Analysis - 12th Jul 18
Gold’s & Silver’s Reversals’ Reversal - 12th Jul 18
The Value of Bitcoin - 11th Jul 18
America a Nation Built on Lies - 11th Jul 18
China, Asia and Emerging Markets Could Result In Chaos - 11th Jul 18
Bullish Gold Markets in the Big Picture? - 11th Jul 18
A Public Bank for Los Angeles? City Council Puts It to the Voters - 11th Jul 18
Yield Curve Inversion a Remarkably Accurate Warning Indicator For Economic & Market Peril - 11th Jul 18
Argentina Should Scrap the Peso and Dollarize - 11th Jul 18
Can the Stock Market Close Higher For a Record 10th Year in a Row? - 11th Jul 18
Why Life Insurance Is A Must In Financial Planning - 9th Jul 18
Crude Oil Possibly Setting Up For A Big Downside Move - 9th Jul 18
BREAKING: New Tech Just Unlocked A Trillion Barrels Of Oil - 9th Jul 18
How Trade Wars Penalize Asian Currencies - 9th Jul 18
Another Stock Market Drop Next Week? - 9th Jul 18
Are the Stock Market Bulls Starting to Run? - 9th Jul 18

Market Oracle FREE Newsletter

5 "Tells" that the Stock Markets Are About to Reverse

Is This Gold Rally The Start Of Something Big?

Commodities / Gold and Silver 2017 Nov 23, 2017 - 06:25 PM GMT

By: Avi_Gilburt

Commodities

First published on Sunday Nov 19 for members of ElliottWaveTrader.net: While I would love to believe that the rally we saw on Friday is the start of the next larger degree break out in the metals complex for which many have been eagerly awaiting, there are many signs that suggest it is only part of a corrective rally.


As I noted in my update last weekend:

“But, please, do not assume we have struck a bottom and expect that we are now ready to break out simply because we see another rally begin in the coming weeks. The market still has a lot to prove to us, especially since the primary set up we now have on our charts suggest we can see prices that are lower than where we closed on Friday. But, again, I will certainly maintain an open mind depending upon how the next REAL rally takes shape.”

Now, the question that I still maintain in my mind is if this is even the “real rally” that I have been looking for over the last few weeks. And, yes, I am still questioning it.

While my primary expectation has been looking for a larger b-wave rally to take shape in gold and silver, many of the stocks I track in the mining complex do not look ripe for the major break out to begin.

First, I want to focus on the metals. The attached 144-minute silver chart is quite representative of the “mess” we have been experiencing in the metals of late. My primary expectation is that we should see a rally in the metals, but I am still not quite certain if we will see one more spike down before the larger b-wave rally I am expecting takes shape in earnest. Unfortunately, due to the messy structure of late in the charts, I have no high probability perspective that suggests we have begun that rally with the move on Friday. In fact, we still have potential for one more spike down before we are able to strike our targets overhead.

But, I think the bigger perspective is that, whatever rally we see, it seems more likely than not that the rally will only set us up for a c-wave down before the market will be ripe for a break out set up into 2018.

That now brings me to the miners. And, I am going to again begin with the leading miner I watch, the ABX. As I have been noting for the last several weeks, the ABX has not likely bottomed. And, I do not believe that the complex is going to be ready to run when one of the largest holdings in the GDX is not ready to run. It will certainly act as a major weight upon the GDX.

As you can see from my daily chart, I am patiently awaiting a wave iv rally in the ABX. But, the micro structure suggests that we could have one more spike down before wave iii has completed. While it is certainly “possible” that the wave iii ended with a truncated bottom, it would take a move through the 14.20-14.30 region to convince me of that potential. As long as we remain below that resistance region, we can still see one more spike down in wave iii before the wave iv rally takes shape. So, in effect, this is presenting in the same way as I view the metals themselves right now. Again, another reason as to why I have been tracking the ABX a bit more closely of late.

So, for now, I am still looking for a rally to take hold in the overall complex. But, I think the jury is still out as to whether the rally seen on Friday is the start of that move higher, or just a head fake before the real rally takes hold.

And, again, I would like to reiterate that any rally that is seen in the coming weeks will likely be followed by a bout of weakness. I see that weakness as a c-wave down in wave (2) in the metals, which could also be something even a bit more bearish in GDX, depending on whether GDX can exceed the 24 region in impulsive fashion to fill in the yellow count or not. My expectations on GDX is supported by the fact that I do not believe we will be ripe for a GDX break out until the ABX completes its waves iv-v, which suggest the ABX will see a lower low below that created in its current wave iii down. A break out in the ABX through its resistance could change that expectation.

Lastly, anyone who can take a longer term perspective on the metals complex would realize that the market is now giving you one last opportunity to board the train which will likely provide us with an extraordinarily powerful rally which will likely begin in early 2018.

See charts illustrating the wave counts on the Silver (YI), GLD, GDX & ABX.

Avi Gilburt is a widely followed Elliott Wave technical analyst and author of ElliottWaveTrader.net (www.elliottwavetrader.net), a live Trading Room featuring his intraday market analysis (including emini S&P 500, metals, oil, USD & VXX), interactive member-analyst forum, and detailed library of Elliott Wave education.

© 2017 Copyright Avi Gilburt - All Rights Reserved Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


© 2005-2018 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules