Latest Gold Price Forecast & Predictions

The bears assemble… but not for the USDX. The greenback has just completed its inverse H&S formation – are these the last calm moments for the PMs?

Yesterday’s (Jul. 26) session might have seemed to be something important or game-changing, as miners moved higher. But it wasn’t.

But miners moved higher while gold moved lower! Wasn’t that the opposite of what you described as very bearish?

It was, but the context was different. The magnitude and time frame were different. The miners’ underperformance that I had described took place over the previous weeks, and what happened yesterday was limited to… well, yesterday.

Consequently, miners’ strength seems to have just been a blip on the radar screen – a tiny correction in the moves in prices and ratios that have been taking place for many weeks.

It didn’t change anything from the technical point of view either.

Senior miners even corrected before the end of the day.

And...

Last week's trading saw Gold forming its high in early-week trading, here doing so with Tuesday's tag of the 1825.90 figure. From there, weakness was seen into Friday's session, with the metal dropping down to a low of 1789.10 - before bouncing slightly off the same into the weekly close.

Gold Market, Short-Term

For the near-term picture, Gold is in a short-term downward phase, coming as a result of the 10 and 20-day cycles, with the smaller 10-day wave shown on the chart below:

In terms of time, the 10-day wave is now 9 trading days along from its last labeled low, which puts it at or into its normal bottoming range. It is too early to suggest this wave has actually troughed, which would require a break above the next upside ‘reversal point’ for this wave - a number which has yet to actually materialize.

In terms of patterns, due to the position of a larger 34-day wave, the probabilities tend to favor the downward phase of the smaller 10 and 20-day cycles to end up as a countertrend affair - which simply means Gold should remain above the late-June bottom of 1750.10. If correct, the next short-term rally phase is likely to make another attempt at our key dividing line of 1835.00.

From the comments made in past articles, the most dominant short-term cycle for the Gold market is the 34-day wave, which is shown again on the chart below:

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Despite gold’s recent rally, the gold miners barely moved or even declined. The downward pressure must have taken root in the miners – will it hold?

In my previous analyses, I wrote about the possibility of seeing another move higher in gold, and that it wouldn’t last long – if we saw it at all. I also wrote that mining stocks would likely disappoint, just as they did in 2012. And what happened yesterday was in tune with the above.

Namely, gold did move higher, but only on a very temporary basis.

In fact, the rally ended even before the closing bell, as gold futures reversed their course and ended the session only $10.90 higher (after being even ~$20 higher intraday). This price action created a bearish reversal candlestick called the shooting star. Such candlesticks tend to be important if they form on relatively big volume. And indeed, yesterday’s volume was relatively big, which means that the implications are bearish.