Gold Price Update

A major consolidation is in progress.

Our proprietary cycle indicator turned down barely this week.

To public readers of our updates, our cycle indicator is one of the most effective timing tool for traders and investors. It is not perfect, because periodically the market can be more volatile and can result in short term whipsaws. But overall, the cycle indicator provides us with a clear direction how we should be speculating.

Investors

During a major buy signal, investors can accumulate positions by cost averaging at cycle bottoms, ideally when prices are at or near the daily 200ema.

During a major sell signal, investors should be hedged or in cash.

Traders

Simply cost average in at cycle bottoms when prices are at or near the daily 200ema; and cost average out at cycle tops when prices are above the daily 50ema.

Gold sector is on major buy signal since early 2016.

Major signals can last for months and years and are more suitable for long-term investors.

Both speculation and open interests are expanding, positive for overall higher prices.

GLD is on short-term sell signal.

GDX is on short-term sell signal.

XGD.to is on short-term sell signal.

GDXJ is on short-term sell signal.

GDXJ has been lagging recently, and for a good reason: http://themacrotourist.com/macro/the-real-message-from-the-gdxj-mess

We’ve been bullish on USD and bearish on gold since 2011, but early this year when USD made a new recovery high and gold did not make a lower low, the major trend may be changing.

USD – has been on a major buy signal since 2011, but that may change soon as prices are testing support while momentum has turned down.

Gold stocks as represented by $HUI did not breakout as we thought it would, but extends its correction into a consolidation. The longer the consolidation, the more powerful the eventual breakout.

Summary

Long-term – on major buy signal.

Short-term – on sell signals.

Gold sector cycle is down.

A major consolidation is in progress.

We are holding some positions for the long-term.

Disclosure

We do not offer predictions or forecasts for the markets. What you see here is our simple trading model which provides us the signals and set ups to be either long, short, or in cash at any given time. Entry points and stops are provided in real time to subscribers, therefore, this update may not reflect our current positions in the markets. Trade at your own discretion.   www.simplyprofits.org