Gold Intermediate Cycle Update

While we are not out of the woods just yet, evidence it beginning to build, from a Price and Time perspective, that an Intermediate Cycle low has been left behind. Gold’s daily and weekly charts look constructive thus far as are the COT reports but the volume patterns are a bit concerning as volume is declining as we have moved higher and we want to see this pattern reverse as volume should start to increase as we move higher.  We have confirmed that Gold has found a short term TCL / DCL, including a failed TCL which is one of the factors we look for when a longer ICL develops.

My first chart is a 2-year weekly showing Gold’s ICLs in Blue. Note that I show the Dec low as an ICL on my chart as Price did close the week above the 10wma but price still needs to close above my Red IC down trend to confirm. My second chart shows you that Gold, on day 8 closed above the 50dma which is a great sign.

My last 4 charts are the COT reports for Gold and Silver which continue to look constructive. Note on the charts to the right how Managed Money long positions peaked in late November and have sold off into what looks like an ICL while the Commercials (Producers and Swap Dealers) have started covering their shorts into the low.

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