Hit & Run has had quite a run in the metals in the last year.
Subscribers have swung GDXJ and leading gold and silver miners such as FNV, PAAS and WPM over a dozen times — each — since the anticipated breakout in June 2019.
It’s easy to become complacent once a projection has been met and a campaign plays out according to expectations.
I remain bullish on the metals, but now looks like the time to protect profits and be less aggressive, waiting for them to reveal a clue as to their next move. Specifically, as my articles below offered, GLD has satisfied a projection to the 170 region I made months ago in the following two pieces from May.
GLD broke out of a an 8 day Slim Jim on Monday, closing at a new high for the move at 170.94.
The following weekly GLD shows what looks like a 5 wave structure subsequent to the Cup & Handle breakout in June 2019 satisfying a possible pattern of 3 Drives to a High.
The low at the bottom of the Cup is 111.
Price does not play out in a straight line, but rather unfolds in a logarithmic sequence.
A concept used by the legendary W.D. Gann called the Square of 9 measures this sequence.
The image below from my Square of 9 Wheel shows that a full 360 degree advance from 111 gives 157.
111 green
157 blue
170 red
GLD struck a weekly closing high of 156 on the week of March 2, 2020 before shaking out to 136.
170 is another decrement of 90 degrees up from the 157 high is the 170 region.
Continued momentum suggests 183 which is an important 540 degrees or 1 ½ revolutions up from the 111 low.
If GLD spikes from here, my expectation is for a near-term Climax Run into early August.
This is 2 years or 720 degrees/days from the major August 2018 low.
As well, 183 aligns with early August.
Summary. The fastest moves, both up and down, are at the end of moves, not the beginning.
These are climatic moves where those that have missed the move can’t take it anymore and jump in at any price, where sold-out bulls clamor back in and where those unfortunate enough to be short capitulate.
Like the NAZ growth glamours, the metals stocks suffered a large range reversal a week ago Monday.
Yesterday saw the miners clear last Monday’s reversal.
The NAZ is working on doing so today.
Here’s a fun fact: QQQ is up 25.5% YTD… but GDX is up 37.95.
After persistent runs, many gold and silver miners such as our PAAS are stood on their heels on Monday.
AG came out of a 7 week Cup & Handle.
Members started a new buying campaign in AG below 5 this year.
Early this month we stated that clearing 11.15 with authority opens the door to 15.
Yesterday AG ripped 10%.
Sometimes Option Sweepstakes and Pin Action occurs on expiration Friday.
Sometimes the run for the roses plays out just after monthly OPEX and the calls have gone to money heaven.
That many have underpinned the metals manic Monday.
Conclusion. In March and April we penned two articles looking for strength in the metals:
The ducks are quacking. Now looks like a good time to feed them.
Members have done so with their positions in GDXY, WPM, SIL, AG and PAAS.
In August 2011, we forecast a top for gold for September based purely on a Time & Price “square-out” using the Square of 9 Wheel.
I had no idea it would take 7 years until a new bull would start in August 2018.
It must be said that many precious metal miners topped months before August 2011 when GLD struck its monthly closing high. For example PAAS topped in April 2011.
Notably, GLD carved out a large range reversal the week of 8/22/11 before setting a new high in early September. The new high was short-lived.
I can’t help but wonder if a similar pattern on the dailies here and now may be playing out with many of the leading miners clearing their mid-July highs.
