Gold And USD Cycles: A Roadmap Of The Bear / Bull Battle

  • Commodities Analysis

Today, Monday, will be day 6 of Gold ’s third Trading Cycle (TC) out of the December 2016 Yearly Cycle Low (YCL). Gold’s longer 5-6 month Intermediate Cycle usually has four shorter Trading Cycles within it (sometimes 3 or 5 but usually 4 shorter Trading Cycles). This coming week’s price action will be critical in determining if we will see a higher high in this Intermediate Cycle (IC) or just a secondary high that will set the IC downtrend line into the next IC Low, which I am expecting in the May/June timeframe.

Based on my cycle work, I do believe the Gold Bull has resumed. However, the transitions from Bear to Bull markets are typically epic battles that take time to play out.

With that as background, third Trading Cycles have been pivotal for Gold over the past 5 years as the only bullish 3rd short term Trading Cycle I can find on the charts over this period was during the first six months of 2016, out of the December 2015 YCL. That 3rd TC topped on day 17.

Other than that one, my chart work shows that every other 3rd Trading Cycle since the 2011 ATH topped on or before day 11 (many topped on or before day 9). My intent here is not be be overly bearish going into this coming week but rather to provide you with the best guidance I can, based on recent cycle history. This post shows the potential transition from Bear to Bull in the Gold market but you can see that it is still a work in process as we enter the week.

In this post, I will focus on Weekly charts for a longer term perspective. From a daily chart outlook, I don’t have much to add to this post from late last week.

Again, Gold is on day 6 on Monday (today), and the following Monday would be day 11. I will be watching closely for topping action especially since the USD is deep in its timing band to find a short term Trading Cycle Low. That said, the USD’s TC’s have been running longer than the normal timing band lately so we could see some more downside action, in silver and miners (via VanEck Vectors Gold Miners (NYSE: GDX )) as well, in the days ahead.

Gold Weekly 2015-2017

Silver Weekly 2015-2017

GDX Weekly 2015-2017

My last chart is a weekly on the USD since last May’s Yearly Cycle Low (YCL). Note that Price is nearing the 30weam where the dollar has found support at recent lows. Remember that a rising 30ema on the weekly that supports price at major lows is bullish (Classic Weinstein Stage 2 Bull market price action).

USD Weekly 2015-2017

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