We believe Gold is setting up for anincredible upside breakout move after reaching our predicted target near $1450.For those of you that have been following our research and Gold calls, we’venailed this move and our October 2018 predictive modeling call has continued tomirror (almost exactly) the price movement in Gold over the past 10+ months. See the chart below.
Our Adaptive Dynamic Learning (ADL) predictive modeling system suggested that Gold would rally from the $1200 level to above $1300, then stall. It suggested that in April or May of 2019, Gold would settle back below $1300 and set up a “momentum base” before attempting an upside breakout move after forming the base. Our research team identified April 21~24 as the likely “price low” for the “momentum base” using our advanced price cycle and other research tools.
You can see from the chart, above, that ourupside price targets from our original research are above $1550~1600. What if we told you we now believe the upsideprice targets could actually be above $1700 and more like $1750 to $1800 on aparabolic upside price rally initiating after price breaks critical resistancelevels?
Take a look at this simple Gold/Silver/USDollarindex chart. The purpose of this chartis to relate the price of Gold to the price of Silver in US Dollar pricelevels. It highlights that Silver isstill very undervalued in comparison to Gold and that any attempt to restore aprice balance between Silver and Gold would likely result in either twooutcomes : A. the price of Gold falls, or B. the price of Silver rallies fasterthan Gold rallies whereas this ratio will attempt to balance out (as we seeback in 2013/2014).
Our Price Amplitude Arcs are a means ofmeasuring price cycles, price waves and allow us to seek out critical priceinflection points. As you can see, wheremultiple arcs align and are breached by price, we typically see some type ofincreased price volatility and trending. Currently, two separate arcs are setting up to be breached and webelieve this is important because of how it aligns with our October 2018research post.
What would cause Gold to rally above $1600 at this time? Why would this become a period where renewed interest in precious metals could drive such a big move? We believe a number of global economic factors will become more evident over the next 30 to 60+ days and that these critical Price Amplitude Arcs are suggesting price is set up to rally from these levels. We believe the move higher will include both Gold and Silver and that Silver may rally stronger than Gold which would cause this Gold/Silver ratio chart price level to move higher – towards our objective line (MAGENTA).
We believe a key date for all traders/investors to be aware of is August 19, 2019 ( 5 days). We believe this will be the date range that the market will break out of existing ranges and when fear and greed will likely solidify in the precious metals markets. We have about 35 days to go before this date and we believe Gold will continue to trade below the “Breakout Resistance” until renewed fear and greed become more evident in the global markets.
Our Current Market Top Analysis and Charts – Click Here
This means the US Dollar will likelycontinue to rally, or at least stay above $96, for the next 25+ days and thatupside US Dollar price activity will partially mute the upside price potentialin precious metals. Overall, the upsideprice momentum in metals will push metals prices higher while the US Dollarcontinues to strengthen moderately. Oncethe US Dollar breaks lower, metals will skyrocket higher (breaking past theBreakout Resistance level) and begin the upside parabolic move.
Any opportunity you find where Gold istrading below $1400 is an excellent opportunity to prepare for this move. Silver continues to trade below $15.50 andcontinues to be an incredible opportunity for traders who understand the ratiolevels of precious metals. Don’t missthis move. It is just a matter of time(30+ days) now.
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Chris Vermeulen has been involvedin the markets since 1997 and is the founder of Technical Traders Ltd. He is an internationally recognized technical analyst, trader,and is the author of the book: 7 Steps to Win With Logic
Through years ofresearch, trading and helping individual traders around the world. He learnedthat many traders have great trading ideas, but they lack one thing, theystruggle to execute trades in a systematic way for consistent results. Chrishelps educate traders with a three-hourvideo course that can change your trading results for the better.
His mission is to help hisclients boost their trading performance while reducing market exposure andportfolio volatility.
He is a regularspeaker on HoweStreet.com, and the FinancialSurvivorNetwork radio shows. Chriswas also featured on the cover of AmalgaTrader Magazine, and contributesarticles to several leading financial hubs like MarketOracle.co.uk
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