The recent rotation in the US stock market and US major indexes have set up a very interesting pattern in the Metals and VIX charts. Our researchers believe precious metals, Gold and Silver, are setting up a new momentum base/bottom and are beginning an early stage bullish price rally that may surprise many traders.
Our researchers believe the bottom in Metals has already set up on October 1, 2019. This setup aligns with our earlier analysis that a new bullish price leg is setting up that will propel Gold to levels above $1600 before the end of November – possibly resulting in a rally that attempts to breach the $1700 price level.
Daily Gold Chart
Of course, for Gold to rally in this manner, some type of extended fear must enter the global markets. We believe this fear could become known to traders within 3 to 10+ days based on our understanding of the schedules and calendars available within the news cycle. The US/China trade talks appear to be breaking down again. News that one of India’s largest banks is in the process of collapsing hit last weekend. And news that the US political parties are about to ramp up nearly all levels of activity ahead of the 2020 US Presidential election cycle is sure to throw the markets a few curve-balls.
As skilled technical traders, there are times when we must understand how the news cycles and external events can have dramatic impact on prices and trends in the financial markets. These are times when we must protect our assets by deploying very skilled trades, proper position sizing and become even more skilled at understanding the global stock market dynamics.
