December gold spiked to new cycle highs ($1246) on continued stock market weakness. Prices will probably maintain an upward bias until the stock market firms. Stocks should stabilize around the November 6th elections.

Miners are bouncing after yesterday’s earnings route. I don’t think prices will recover Tuesday’s $21.51 highs before the elections. Once this bounce/consolidation is complete, we should see a breakdown below the cycle trendline.

I’m still expecting an October top in metals and miners followed by November/December weakness. However, this outlook requires the stock market to stabilize between now and the elections. A major surprise at the polls could change my perspective and promote a sharp increase in gold.

The weekend newsletter will be out Sunday.