Big Gold Rally This Week, Stocks Down?
Last week, I wrote that I believed GDX would make one final blow-off top into or around September 1.I also wrote that the stock market looked too hard to trade at this point. When the SPX dropped to below 2161 on Friday we went long via SPXL and SVXY. Today (8/29) we sold for some nice profits (+2.8% and +5.5%).
I believe the SPX could drop all the way to 2112/13 by September 1 and GDX could hit my 35.47 target on the same day. The charts below show what I believe could happen. As always, please keep in mind that these charts are forecasts over the next week and may be subject to change.
(Click on image to enlarge)
(Click on image to enlarge)
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The normal Mercury Rx Cycle switched from a top to a bottom (inverted) I now expect to the top on Sept 8 near 33.50. New chart coming.
This would require the gold miners to gain over 30% over the next two days, all the while the dollar is in rally mode. This is a VERY highly unlikely scenario.