With Wednesday’s Fed meeting behind us, precious metals can resume their uptrends. A breakout in gold should extend to challenge $1700+ in March.
On Tuesday, we advised readers that the reversal in gold and jaw-dropping 3.31% decline in silver was probably pre-Fed shenanigans. Our assumption was correct, and prices reversed the next day. The collapse in silver was unwarranted and likely manipulated. These events often precede a major reversal.
Gold Breaking Out
Prices are just now breaking free from the January mid-cycle consolidation. Prices should continue higher for another 4-6 weeks and challenge $1700+ in March before this 6-month cycle peaks.
Silver Prices Flushed
Tuesday’s 3.31% collapse is silver likely flushed retail traders out of their positions just before the next advance. These stunning moves create massive liquidity so large traders can enter at rock bottom prices. A daily close above $18.20 will establish the next leg higher and support a rally to $20.00+. I think silver could exceed the $21.25 high set in 2016.
Junior Gold Miners Target
The symmetrical cup with handle pattern in juniors is nearly complete. Tuesday’s retest of the 50-period MA was likely the final pullback before prices break above $43.00. The traditional cup w/ handle pattern supports a target near $52.00.
Overall, we expect metals and miners to continue higher into March, potentially peaking with the coronavirus. From there, we’ll assume a multi-week correction into the next 6-month low and subsequent buying opportunity (presumably late May to early June).
AG Thorson is a registered CMT and expert in technical analysis. He believes we are in the final stages of a global debt super-cycle. For more information, please visit https://goldpredict.com/
This article was originally posted on FX Empire
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