Blog

The scenario envisioned in the NFTRH+ update last Sunday is coming about.

“It” being gold. “Right here” being the support level at 4250-4300 currently being lost. The 38% Fib (not shown below) coincides with the March 23rd low of 4098.

Now for the evaluation of quick plunge and reversal (whether in pre-market or during trading hours today, or one day this week) vs. failure. There would be nothing like a final plunge to stir up some drama.

Silver’s best ultimate support has long been viewed as the long-term breakout area in the low-mid 50s. With the weakness in the complex this week the odds of that being registered, turning the blue arrow red in a would-be third lower low have increased. But it’s still a long way down, and no sure thing. As with gold, we can watch the March 23rd low (61.02) as a decision point on that.

GDX (using it instead of HUI because it shows pre-market activity) is registering the 50% Fibonacci retrace level at 74.82 in pre-market.

The miners can obviously also perform the ‘final plunge and reversal’ feat if that is what is in store for the metals. It would very likely be a capitulation event, if that’s how the correction ends. A real bottom.

Again for reference, here is HUI monthly showing how important the upcoming long-term support zone is. Many months ago we speculated how dramatic it might be for Huey to fall all the way down to 575-635. Now it is nearly happening. Note that a 50% Fib retrace of the ENTIRE rally resides around 590, right in the midst of the support zone.

I don’t know what, if any news is driving markets down this morning. A correction was needed in the broad market and it is here, whether mild or intense. I am resentful that I was driven to chicken out and cover my Intel short yesterday. But here’s the thing about trading. You can trade right back into a position (or others).

As for the precious metals, we have been and continue to view the complex as a leader, to the downside and up. Having cash is a good thing.

As a final note, the USD and Gold/Silver ratio are muted in pre-market. So there is no alarming spike or anything of the kind happening this morning during this pre-market snapshot of events. This is just one day. But if there were a real time crisis in markets, they would probably be ramping.

I purposely wrote this entire update before looking at the news. It’s more of the same. Trump vs. Iran, wars of words and threats. I believe we are in the final innings of this bullshit war. Markets could put on a bear show in the meantime.