Gold In Striking Distance Of 2011 High

Gold prices are within striking distance of the all-time high set in 2011 ($1923). In my opinion, it would be unusual for prices to break out to new all-time highs on the first try (typically there is a prolonged consolidation). Consequently, I still think prices could peak and begin a correction back towards $1550.

Note: A sustained advanced above $2000 in August would suggest the inflationary pressures are too great, and prices could persist higher into the elections.

I’m happy to report silver prices finally confirmed a new bull market and exceeded the 2016 high ($21.23). Prices reached $23.67 intraweek, and I think they could touch $26.00 before the trend takes a breather.

Platinum is yet to take out its 2016 high ($1199.50), but that could change in the coming days/weeks. If speculators begin to pile in, I see the potential for an explosive rally higher (like silver).

The US dollar is at critical trendline support. If it stabilizes in the coming days, gold prices should begin to roll over and correct. If the dollar collapses below support, then gold could breakout above $2000 earlier than I expected.

The gold cycle indicator is at max topping (450). The cycle is extended. I continue to look for evidence of a top.

US DOLLAR

The dollar is testing a trendline dating back to 2011. Prices need to find support above 94.00, and soon to prevent a significant breakdown. Collapsing below 92 could trigger a sharp decline. The next 3-year low is due around January 2021.

GOLD

I have to admit; gold has rallied much higher than I initially expected. I felt prices would be contained to the $1800 level. Government stimulus was more aggressive and entered the actual economy faster than I anticipated, creating immediate asset inflation.

With our cycle indicator pegged at 450, a cycle peak remains possible any day. I continue to see the potential for a decline back towards $1550 – $1600 by September. The $2000 level is key – a sustained advance above $2000 could lead to a runaway move into the elections.

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