Gold Catapults From Its Bullish Cup And Handle Pattern. How High Is Up?

Gold busted out sharply higher this past week predictably after finishing its Bullish Cup and Handle pattern we were showing in development for months. Let’s take a look.

The first pattern we show is an Ascending Bullish Triangle.

While Gold may soon be completing the fifth small subwave of its first larger degree subwave of 3-up, with a corrective decline coming once it finishes, the upside price target from several patterns we are watching is the 1,600 to 1,650ish area. Mining stocks also popped sharply higher as it started wave 3-up. These moves came after our HUI key trend-finder indicators triggered new Buy signals May 31st, and remain on Buys this weekend.

We are seeing positive charts for gold, with several different patterns and wave mappings confirming the Bullish case. They all have an upside price target for gold of 1,600 to 1,650ish over the coming months.

Below we see an Elliott Wave mapping chart that breaks down the moves for this Ascending Bullish Triangle, which confirms a powerful wave 3-up of 3-up move is starting in gold. Wave threes are usually dynamic.

Above we see there also is a massive Bullish Inverse Head & Shoulders bottom pattern which is complete. This pattern measures the collective psychological state of mind for gold investors everywhere. It projects an upside price target of 1600 to 1650 over the coming months.

Next we see that gold just finished its large degree Bullish Cup and Handle pattern, completing the final portion of the pattern, the Handle, which also happens to be wave 2-down of 3-up. Gold has broken out sharply above the Handle. This pattern breakout was expected for months as we monitored its completion, and means gold will rise sharply toward at least 1,600ish inside wave 3-up. That rally has started.

The next chart below shows gold’s upside breakout Friday, May 31st, taking gold decisively above the upper boundary of a Declining Bullish Wedge, which acted as the Handle portion of a Bullish Cup and Handle pattern. This is strong evidence that the Declining Wedge is complete, which means the Handle is complete, which means the Cup and Handle is complete, and means gold is now rising sharply toward at least 1,600ish inside wave 3-up.

Gold is close to completing subwave {i} up of {1} up of 3-up. Once complete, corrective wave {ii} down will follow.

At McHugh’s www.technicalindicatorindex.com we have developed several proprietary indicators that help us identify when the next significant move is starting for Mining stocks, and in which direction the move will develop. We publish these indicators in every Daily Newsletter to subscribers.

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