19 thoughts on “CHART FOR THE WEEKEND

  1. Jay

    Rally likely not done here, but still hard to trust this rally, since it seems very clear that once this rally is over, the metals bear will continue, and we will eventually see $950 an ounce or lower for Gold, and GDX as low as single digits. Learn to hedge your bets and manage two positions. 🙂

  2. Aida

    Every Wave analysis I read states that this rally should end soon at a lower high than the previous August high. Forecast is for 1150 and then a continued descent to 1000-1050ish. The logic here is that weakness is required (lower high) to initiate the last and final leg down. This capitulation phase, although not required but generally seen before reversals, must start from weakness and not from strength as in a higher high (1240ish) as Gary expects. Wave analysis shows us in an expanding descending triangle with one final lower low! Gary, this is a very possible scenario which shouldn’t be discarded. TO be invalidated a much higher high would have to be seen.

      1. Aida

        As you have stated many times, capitulation isn’t about a recent low breaking, it is an EMOTIONAL experience with 5 – 7 days on average of terror where many stocks go no bid. We did NOT have this phase, what you call a bloodbath phase. Do we need it to reverse? Rick Rule thinks so, and his latest thinking can be found on Sprott’s thoughts (sorry can’t post link). He sees the final lows in by end October and suggests investors prepare for this and not be caught off guard. You also have stated many times that these 5-7 day phases are required before turnarounds can be seen. I am fully long miners and hope you are right, but you should be telling your subscribers that this last phase is still a possibility until the market tells you it isn’t.

  3. Jorgy

    I just love all the skeptical comments on this being just another bear market rally here, Bull/Bear and Korelin’s blog. The comments are perfectly aligned with sentiment and the fact that it has been 4 1/2 years since the silver bull topped in April 2011. People forget the cyclical bear is just a midpoint consolidation of the secular bull that started in 2000. Silver went from $5 to $50 and back to $14 in 15 years. We’re going from $14 to $150 from 2015 to 2030. Most gold/silver miners are a shadow of their former 2011 selves and offer some of the most compelling valuations of our lifetime at present levels.

    1. gary Post author

      Yes, no matter how far down a bear market goes one can always conjure up a reason for it to go lower.

      At 100 on the HUI it doesn’t get much better than that. But traders will only be able to see 100 going to 50, and then 50 going to 25, and then 25 going to 12.

      Thats just the nature of recency bias.

    1. carlvan

      I have to disagree with you: the right shoulder for GLD is at 109.77 and the high Friday was 109.38.
      So, as such there is no H&S invalidation yet. Hopefully that will comes next week.

      1. gary Post author

        If I can’t see a head and shoulders pattern clearly on a weekly chart then I tend to ignore it as just a figment of traders imagination and nothing more than noise. I don’t see any H&S pattern on the chart above.

  4. zkotpen

    Skepticism is the natural result of uncertainty. Until gold breaks above 1170 or below 1072, both bullish and bearish scenarios remain valid. Since last Friday’s lows, both scenarios called for upward price movement. Since yesterday’s high, both call for downward price movement, though they begin to diverge on the question of how much.

    How effusively you state your case does not make it more likely, much less a certainty.

    The 1970s gold bull lasted about 10 years and was followed by a 20 year bear market, and that this is typical of the commodities cycle in general. Just look at the long term CRB index or price of gold and that will become clear. Somebody posted a link here yesterday to a Bloomberg article regarding Goldman’s expectation that the oil bear will likely persist until 2030, with an overall long term price target of about $50 per barrel. I believe that will be the case for commodities in general.

    The bull market that began in 2000 was a cyclical bull, within a super-cyclical bull market. What people don’t seem to recognize is that the 1970s bull bull within a bull was much larger than that of the 2000s, in terms of percentage change in price.

    1. gary Post author

      Actually the average commodities bull usually runs about 15-20 years. The bull in the 70’s was the shortest in history and to a big degree driven by Nixon taking the dollar off the gold standard and the subsequent inflation that followed.

  5. Stefan

    This IS a bearmarket rally, we still got a long way to go before we enter a new bull. Fibonacci tells us that.

    After a decline from this rally wave two will be more profitable.

  6. Richard Greulich

    The classic Edwards and McGee definition of a Head and Shoulders chart formation is that it comes at the end of an extended move, not just anywhere in time. The above-mentioned H&S pattern in Gold does not fit that classic definition. Any H&S pattern in gold that could be identified at this point would almost certainly have to be a H&S bottom, per Edwards and McGee definition. But at this point, the gold bottoming pattern does not match the full H&S criteria. It is likely bottoming, just not in an H&S pattern.

  7. Dan

    5% in silver for the long term, but it’s way too early to call the end to this bear market. I’m staying short the SPY, betting against the market this summer has been far more profitable for me than trying to time the wild swings in miners.

    Despite Fed interventions, I suspect deflationary forces will win out eventually and crush all assets. Just look at the plunge in oil on Friday.

Comments are closed.