The precious metals have continued pulling back and per our work in NFTRH 567 could have lower to go. Gold halted perfectly in the targeted resistance zone and this morning is continuing to fade to the SMA 50. It all looks normal so far. Although I’ve preferred a drop to the 1430s, let’s be aware that a moving average like the SMA 50 can itself act as support to a normal uptrend’s pullback. The SMA 50 and 200 trends are both up and it all looks normal (click charts for larger, clearer views).
Silver dropped hard back below the original target of the 18.60-18.70 area. It is trying to compose itself this morning, but there is no support at this area unless you go back to some minor looking support from 2017 (not visible on this chart). But still, the pullback has been pretty harsh and it could try to bounce. The key again would be that resistance line at 18.67 (resistance is not visible on this daily chart, but it’s there and it is significant). Take out that marker and silver could again be on its way. Stay below it and it would be vulnerable in the short-term with the next target in the 17.30s. Right now it’s below it and so, that is my bias… correction in progress.
HUI continues to drop, losing the 1st short-term support and the SMA 50. Technically, it looks like 195 is next up on the daily chart. It could be a whipsaw and shakeout before a reversal back upward (happens all the time) but as long as it is below the 210-212 area it is vulnerable to further downside. It’s been a good pullback so far and I added a couple positions yesterday (AXU & WPM) because I don’t want to be too cute thinking I can trade to a dime. I can’t.
The US stock market is getting a pullback to test the breaks above the SMA 50s. That is what opened up the prospect of a drive to 5 (point #5 on the SPX Reverse Symmetrical Triangle, not visible on this chart) and a potential new high. A hold of the SMA 50 (2948) keeps that in play. A loss of it would start to portray the analysis of a drive to 5 as being wrong. Just as the SMA 50 was my marker to the upside, it will perform the same role to the downside. Was resistance, now support.
2019 has been a profitable year and my overriding goal will be to keep those gains, the vast majority of which are intact even after the precious metals pullback. I plan to shoot everybody first and ask questions later, especially with the FOMC on the near horizon.
The current short-term plan is for a precious metals pullback and an ill-fated rally in US stocks. If I start seeing parameters broken I’ll adjust. I’d get very cautious on the US stock market (and possibly others) if SPX and other US headliners start to take out support. It promises to be a complicated Q4 and one thing that is not complicated is cash. It’s actually handy during troubled times.
But for now, the plans appear unaltered from NFTRH 567.