Metals and miners continue to consolidate ahead of tomorrow’s employment report.
Overall we continue to look for a breakdown in gold below $1900 in September.
The stock market is finally showing signs of weakness, and an interim high is possible. Stocks should remain under pressure into the November election. Expect increased volatility.
The dollar should stabilize a bit and rebound into October/November.
In my annual recap, I noted how record low gold eagle coin sales in 2019 likely signaled a shift in precious metals from record low demand to record high demand over the next decade. That forecast seemed timely as fear gripped the market 3-months later, and coin sales soared.
Now I’m beginning to think shortages and inadequate supply could send premiums on certain coins to unbelievable heights. For example, I believe 1-ounce silver eagles could fetch double the spot price, and possibly much more as acquiring physical coins becomes challenging.
The gold cycle indicator finished at 298. It should continue to work its way lower and eventually dip below 100 (cycle bottoming).
-GOLD- Gold is consolidating in a B-wave triangle formation. Prices should eventually break below $1900 and drop into the next 6-month low.
-SILVER- Silver needs to break below $26.00 to trigger the decline phase of the intermediate-degree correction. Initial support arrives at $22.50 – and below that $19.00.
-GDX- I think miners are also working on a B-wave triangle that should eventually break lower into the next cycle low.
-GDXJ- Juniors need to slip below $54.00 to trigger an intermediate decline.
-SPY- This could be the beginning of the September weakness I’ve been expecting heading into the November elections. Closing below 335 would promote a test of the 300 level – a sharp correction could reach 285.
Have a great night.