Most Popular
1. It’s a New Macro, the Gold Market Knows It, But Dead Men Walking Do Not (yet)- Gary_Tanashian
2.Stock Market Presidential Election Cycle Seasonal Trend Analysis - Nadeem_Walayat
3. Bitcoin S&P Pattern - Nadeem_Walayat
4.Nvidia Blow Off Top - Flying High like the Phoenix too Close to the Sun - Nadeem_Walayat
4.U.S. financial market’s “Weimar phase” impact to your fiat and digital assets - Raymond_Matison
5. How to Profit from the Global Warming ClImate Change Mega Death Trend - Part1 - Nadeem_Walayat
7.Bitcoin Gravy Train Trend Forecast 2024 - - Nadeem_Walayat
8.The Bond Trade and Interest Rates - Nadeem_Walayat
9.It’s Easy to Scream Stocks Bubble! - Stephen_McBride
10.Fed’s Next Intertest Rate Move might not align with popular consensus - Richard_Mills
Last 7 days
Stock Market Trend Forecasts for 2024 and 2025 - 21st May 24
Silver Price Forecast: Trumpeting the Jubilee | Sovereign Debt Defaults - 21st May 24
Bitcoin Bull Market Bubble MANIA Rug Pulls 2024! - 19th May 24
Important Economic And Geopolitical Questions And Their Answers! - 19th May 24
Pakistan UN Ambassador Grows Some Balls Accuses Israel of Being Like Nazi Germany - 19th May 24
Could We See $27,000 Gold? - 19th May 24
Gold Mining Stocks Fundamentals - 19th May 24
The Gold and Silver Ship Will Set Sail! - 19th May 24
Micro Strategy Bubble Mania - 10th May 24
Biden's Bureau of Labor Statistics is Cooking Jobs Reports - 10th May 24
Bitcoin Price Swings Analysis - 9th May 24
Could Chinese Gold Be the Straw That Breaks the Dollar's Back? - 9th May 24
The Federal Reserve Is Broke! - 9th May 24
The Elliott Wave Crash Course - 9th May 24
Psychologically Prepared for Bitcoin Bull Market Bubble MANIA Rug Pull Corrections 2024 - 8th May 24
Why You Should Pay Attention to This Time-Tested Stock Market Indicator Now - 8th May 24
Copper: The India Factor - 8th May 24
Gold 2008 and 2022 All Over Again? Stocks, USDX - 8th May 24
Holocaust Survivor States Israel is Like Nazi Germany, The Fourth Reich - 8th May 24
Fourth Reich Invades Rafah Concentration Camp To Kill Palestinian Children - 8th May 24

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Gold Bears Are Roaring Louder

Commodities / Gold and Silver 2018 Jul 16, 2018 - 03:44 PM GMT

By: Avi_Gilburt

Commodities

For those that follow me regularly, you will know that I have been tracking a set-up for the SPDR Gold Trust ETF (NYSEARCA:GLD), which I analyze as a proxy for the gold market. I also believe that gold can outperform the general equity market once we confirm a long-term break out has begun.


While I have gone on record as to why I do not think the GLD ETF is a wise long-term investment hold, I still use it to track the market movements. For those that have not seen my webinar about why I don’t think the GLD is a wise long-term investment, feel free to review this link for my webinar on the matter.

As we came into 2018, my expectation was that if GLD was able to hold over the 119 region into the summer, we could likely challenge the all-time highs in gold as early as the end of 2018. Unfortunately, with the break below 119, it is likely pushing off that potential until next year. Moreover, with the break below 117.40 this past week in the pre-market, we will need to see another setup develop before we will be ready for a major break out in gold. And, this will likely take weeks to months to re-create.

Now, before you take what I just said as me being bearish, I want to dispel you of that notion. Rather, when we review the larger degree perspectives we track in the metals market, the bigger picture is still looking quite bullish.

Many of you will look at the downtrend we are now within, and scratch your heads as to how I can possibly be bullish. Well, I don’t make determinations about the market based upon what happened yesterday. Rather, I view the pullback as approaching completion based upon its structure, as well as the supporting technical indicators. This is no different than when I turned “strongly bullish” at the end of 2015. Yes, we were still in a multi-year downtrend, but that downtrend structure was reaching its completion, similar to what I am seeing now on the larger degree. Now, the indications suggest that, while the market may yet see more weakness over the coming weeks, the bottom is likely a lot closer than most realize.

In fact, I am again seeing many articles coming out suggesting that you must stay away from metals. I am even seeing many articles coming out with perspectives presenting their certainty that gold is heading below $1,000. And, yes, many of them were written by those who were looking for a break down below $1,000 gold back in 2015/2016, and they missed one of the strongest rallies seen in the metals complex. I suspect they will be left in the same position as we look forward towards 2019. And, if you are asking yourself about the bullish articles, generally I don’t even bother reading or looking at articles from perma-bulls, as we already know what they are going to say.

I know that this consolidation has taken way longer than any of us expected. Unfortunately, timing is not something that one can analyze to a high degree of probability when it comes to markets. So, while this consolidation has certainly lasted much longer than I had expected, the basic overall larger degree structure which presented as bullish a year ago still remains quite intact, even though we have seen the passage of a significant amount of time. But, due to my fear of an extended pullback, I have strongly, and seemingly appropriately, urged all of my subscribers to stay away from leveraged instruments (3X ETF’s and options) until the market confirms its break out signal.

But, I do want to add one note before I sign off for the weekend. I track silver on a 144-minute chart, on which I use a MACD indicator. Each time that MACD indicator has presented with positive divergences, it has successfully signaled an imminent rally in silver without fail for years. While nothing is infallible, and we could certainly see a failure, the probabilities suggest we are closer to a bottoming than most realize. These types of divergences, when stretched, often build strength in the market which is then seen taking it strongly in the opposite direction. And, right now, it is screaming to me.

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.

© 2018 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.


© 2005-2022 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