Today’s move up in Gold, above the 1221 high of December 1, confirms that this is newer and more bullish primary cycle of the two options we have been observing. Previously it
was not clear if the primary cycle began on October 6 at 1183.30 in the nearby futures contract,or December 1, when it bottomed at 1130.40, also in the nearby December contract. We knew
that if the bottom was October 6, Gold would be bearish, headed below 1130 in late December
through mid-January for a contracted primary cycle to end the 17- and 34-month cycle lows.
However, we also know that if November 7 was the primary cycle trough, then it was a distorted
(expanded) primary cycle, and that would be the end (and start) to the 17- and 34-month cycle
lows. It began to look that way of December 1 when Silver plummeted to a new 5-year low on
December 1, and Gold held above its low of November 7, for a case of intermarket bullish
divergence.
Yet it was not until today, December 9, that the primary cycle could be confirmed as starting
November 7. Today, Gold made a new cycle high, in the fifth week of the cycle that started
November 7. It is also well above the 45-day moving average, now at 1202.50, which is another
confirming signal that November 7 was a primary cycle trough.
As stated in previous reports, the 17-month cycle trough was due 17 months, +/- 3 months,
following the low of June 2013 when Gold fell to 1179.40. November 2014 was 17 months later.
The 34-month cycle was due 34 months, +/- 6 months, after the low of 1520 area on December
29, 2011, or October 2014 +/- 6 months. November 2014 was 35 months later, which is close to
exact.
The fact that Silver made a new 5-year low at 1415.50 on December 1, and Gold did not, is
further support for this labeling. Gold is now in the 5th week of its new primary, and probably
16- and 34-month cycles. Silver is starting the 2
nd week of its new primary cycle, and possibly
even longer-term cycles. The first phase of all cycles is bullish. This means the current primary
cycle is most likely to hold those recent lows throughout this primary cycle. It also favors the
idea that both markets will not top out in this primary cycle before the 8th week. Therefore,
investors and position traders may apply bullish strategies, which means: buy all corrective
declines with stop-losses below those lows of the past month.
As long as those lows of November 7 in Gold and December 1 in Silver hold, the rally in
Gold is expected to last 4-11 months. The price target for the crest in Gold projects to be either
1463 +/- 78.50 or 1282 +/- 36. If the rally lasts more than one year, or if it exceeds 1540, it
would indicate that this is a new longer-term bull market – longer than the 17- and 34-month
cycles. This is possible, for the low in Silver may have been the longer-term 18.5-year cycle.
Measured from its last bottom in 1991-1993, this would have been the 20th or 22nd year of that
cycle. In that case, there is no limit to how high Silver (and even Gold) can go, if Silver can
exceed 50.00, which it could if this is the case.
For now, our longer-term cycles’ analysis suggests strongly that Gold has now started its
new 17- and 34-month cycles. Short-term, there is support building at 1199-1204. However, any
drop below 1145 would seriously jeopardize this new bullish development, and put us back on
track for a very sharp decline into December 22-January 16. In March Silver, support is building
around the 1600-1620 mark. However, it would take a plunge below 1415.50 to negate this new
bullish set up.
Once again, our trading strategies will now shift to bullish because of today’s development.
I expect there will be declines between and January 5 due to the abundance of Uranus signatures
in force December 19-January 5. Right now, we are in a time band of several Jupiter signatures,
which is normally bearish for Gold. The fact that Gold is bullish during the aspects also indicates
a bullish bias to the market
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