By: Jeff Cooper
Hit and Run Bonus Report: December 29, 2022
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What's Next for Gold?
Hit and Run members have capitalized on the precious metals rally from late September.
However, as outlined yesterday with charts on GLD and GDXJ, precious metals were at resistance.
Accordingly, on Tuesday, we sold the majority of our most recent purchase of GDXJ.
See GDXJ daily from yesterday’s note here again
In addition GDXJ is 90 days/degrees from the late September low and as shown in yesterday’s report, GLD is at well-defined resistance.
The bull case is whether a 1st wave off the low has completed.
There is even an outside shot that a corrective wave 2 has completed.
The bottom line is that the next rally attempt needs to be clearly impulsive with undeniable momentum.
This is because in addition to the patterns at hand, cycles suggest the possibility that the rally forecast into late December is culminating into a larger corrective move on the downside.
As noted yesterday, cyclically, there is case that can be made for a continuation of the metals rally into March/April.
In essence, ideally, I am still looking for a further near-term pullback to reset the technical and complete a correction.
When that correction is complete, the nature of the next rally will tell us whether the bulls have field position for an extension higher into March/April.
If momentum shows up after this correction with GDXJ powering north of 37.50 then, we will initiate our usual mining suspects (with a few new names) as strength in January opens the door to a runaway move.
But for now, I think they have some corrective wood to chop.