- Precious metals and miners could reach cycle lows by the end of this week. I think we could see a bottom within the next 3 to 5 trading days. Ideal support for gold arrives between $1250 and $1260.six
- Silver is testing major support around $14.00. I suspect prices will hold, but we could see a dip below $14.00 if short-sellers push aggressively.
- The 45-day cycle in miners is scheduled to arrive this Friday (give or take a day). If prices break lower tomorrow or Thursday, I will look for a bottom on Friday or Monday.
- The stock market seems vulnerable. It’s possible we see a “Sell in May and go away” situation. That would setup a potential bottom in gold in the coming days.
-SPY- A megaphone topping pattern remains possible in the stock market. A sharp decline below the 200-day MA would embolden that outlook. However, to confirm a bear market, prices would have to slip below last years 232.73 low. It’s too early to know if the US is headed into a recession, but the odds are increasing.
-XAU MINING INDEX- The junior mining has had a relatively consistent intermediate cycle lasting about 45-days. If we get a quick spike lower between now and Friday, I’ll look for a bottom and cycle low.
-GOLD- I will look for a bottom if prices test the $1260 area later this week.
-SILVER- Silver is approaching long-term support near $14.00. A sharp move lower is possible in the coming days. We could see a dip below $14.00. I would only get worried if silver closed below $13.50. That would be considered a breakdown, and selling could increase.
-GDX- The consolidation that started in May is taking the shape of a triangle. Breaking below $20.00 between now and Friday would increase the odds for a cycle low in the coming days.
-GDXJ- Junior miners have already broken down from their consolidation. I will look for a bottom within the next few trading days.
Have a great night.