Our proprietary Gold Cycle Indicator (GCI) was designed to help navigate the 6-month cycle in gold. The numerical value in the center of the gauge ranges from 0 – 450, and rises and falls with the price of gold. A high number supports conditions ripe for a top – a low number, a bottom.
A Magic Formula: Every trader is looking for that magic formula. You know – the perfect assortment of tools and indicators that times every top and every bottom perfectly. Sadly – it doesn’t exist. Today’s markets are global and continually changing, what works now may not work a year from now. With that said, our Gold Cycle Indicator is exceptional, but it’s not absolute.
Important To Know: The Gold Cycle Indicator behaves differently in bull and bear markets. That’s why I designed it with minimum and maximum ranges.
- In BULL markets, the GCI will spend more time in minimum/maximum TOPPING, and less time BOTTOMING.
- In BEAR markets, the GCI will spend more time in minimum/maximum BOTTOMING, and less time TOPPING.
GOLD CYCLE READINGS
0-50 MAXIMUM BOTTOMING: A score of zero is rare and indicates extreme selling and capitulation. In BEAR markets, the GCI will spend a significant amount of time below 50, sometimes weeks. In BULL markets, dropping below 50 happens on occasion and is usually an excellent long-term opportunity.
51-99 MINIMUM BOTTOMING: In BEAR markets, the GCI will spend a lot of time below 100 and is NOT indicative of a bottom. In BULL markets, cycles (prices) typically bottom in this area.
100 – 349 NEUTRAL: The GCI spends the majority of its time in this zone as the cycle fluctuates between topping or bottoming.
350 – 400 MINIMUM TOPPING: In BEAR markets, prices usually top in this area. In BULL markets, the GCI will spend a significant amount of time above 350, and it’s rare for a cycle to peak below 400.
401 – 450 MAXIMUM TOPPING: In BEAR markets, the GCI rarely reaches this level. In BULL markets, the GCI will spend a significant amount of time above 401, and we usually don’t see a top until it approaches 450. In robust bull markets, the GCI can remain about 401 for weeks.
How I use the Gold Cycle Indicator: In June 2019, gold confirmed a new bull market when prices broke above $1400. I believe the next decade (2020 – 2030) will favor gold and precious metals. Moving forward, I plan to use the Gold Cycle Indicator primarily as a buy signal to accumulate metals and miners. In bull markets, I try to focus on buying – not selling. As the bull market advances, picking tops will become increasingly difficult.