Gold Price And Gaps

April 8, 2017

First, let me say that a new high by gold in week 16 of this current Intermediate Cycle is an extremely positive development as we now have a setup which should ensure that gold has a Right Translated cycle that makes a higher Intermediate Low than the December 2016 YCL. Should this play out to Cycle norms, the next Intermediate Low will be an excellent buying opportunity regardless if you are adding to positions or restocking the shelf. My current expectation is that the next IC Low will be in the May/June timeframe with May being a strong possibility.

Regarding today’s action, remember that this spike up in gold and PM’s was a “news driven” event. Should things escalate in Syria over the next week or so, gold will likely benefit but if this turns out to be just a warning shot across the bow, the rally will likely fade as it is getting late in gold’s 3rd Trading Cycle.

Lastly, you know my view on gaps, especially near where one would expect a top. Breakaway Gaps are seen at or near major lows and not in the area of where a timing band is signaling a top. I view the gap up today as being very similar to what we saw with the SPX in late Feb where we had a classic Island reversal.

Here are some charts of GLD, SLV and GDX showing today’s Gaps.

Added: A late day update on SLV showing it has more than closed its gap from this morning. A close below the 200ma and the 10ema would confirm for me that it has started its move into a TC3 Low here.

 

 

https://surfcity.co/    Everything about Cycle Investing

© 2017 Surf City - 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.

Surf City is a pseudonym for a 60-year-old retired Information Technology Executive and Software start-up Entrepreneur living near the beach in California.   He has been an active investor and trader since the mid-1980s. Analytical by nature, his sound investments over the years allowed him to retire at a relatively early age of 55. In addition to the standard Technical Analysis tools of Edwards and Magee, Surf is a disciple of Walter Bressert’s Cycle Methodology and Stan Weinstein’s Stage 4 Market analysis.  Surf combines these skills to develop his unique “Cycle Price Channels.”  Some call them “Surf’s ForkCycles.

18 karat gold is 75% pure gold.