The cleanest cycle I can find is the XAU junior mining index. Prices have formed turning points every 45-trading days since September. It arrives again May 31 and should time the next low.

XAU

The 45-day cycle in the XAU has been quite accurate timing the last four turning points. The next one is scheduled to arrive May 31st.

GOLD

To confirm the XAU cycle, I’d like to see gold dip down and test or marginally breach the 200-day MA by the end of next week. If it does, then there’s a good chance gold will bottom between $1250 – $1260.

SILVER

Prices have been grinding lower in a tight little trend channel — no signs of a bottom. Support starts around the $14.20 level.

PLATINUM

Prices reached the lower trendline. There is significant support between $750 – $800 and I suspect we will see a bottom in the coming days/weeks.

GDX

According to the 45-day cycle, we should get a turning point next week. I assume it will be a low, but I can’t be sure (prices have traded sideways for 3-weeks). I’ll look for a bottom on Thursday or Friday if prices slip below $20.00.

GDXJ 

I’m on the hunt for a potential bottom towards the end of next week.

SPY 

I can make a case for a megaphone topping pattern in the stock market. The odds for a recession are increasing.

PROBABILITY OF A RECESSION INDICATOR

Below is the Fed’s recession indicator predicted by the treasury spread. It has reached its highest level since 2007. The odds are beginning to favor a recession in 2020. The stock market often tops 6 to 9 months before a recession.

WTIC

I suspect oil will find support between $54.00 and $57.00. It would take a sustained decline below $50.00 to recommend something more ominous and a potential bear market in stocks and oil.

BITCOIN

 It looks like prices are consolidating around the $8000 level. We could see prices break higher and test $10,000.

Some consider me a bitcoin bear – that’s not the case. I believe cryptocurrency will continue to grow and likely be the future of money. However, I think bitcoin got way ahead of itself in 2017. The parabolic run to $20,000 was near vertical and had all the hallmarks of a bubble. Historically speaking, it usually takes years for that type of speculative market sentiment to unwind…not just 12-months.

Typically for a major bottom to develop, investor sentiment reaches hopelessness and despair – we are nowhere near that in bitcoin. For that reason alone, I’m not interested in bitcoin as a long-term investment. Besides, for $8000, I’d much rather buy 10 ounces of platinum knowing it is undervalued.

Think about it. Platinum on average, usually costs more than gold. Currently, it is $480 cheaper. I’d say the odds are near 100% that at some point platinum will return to parity with gold, at minimum. So in theory, buying platinum today is like buying gold at $800.

US markets are closed Monday for Memorial Day.