Gold & Dow: Santa Claws Comes To Town

Weary investors who endured the September and October stock market “crash season” felt they should be richly rewarded for their incredible patience… with a wondrous Santa Claus rally.

The traditional Santa Claus rally has morphed into a hideous Santa Claws mauling of millions of US stock market price chasers.

It’s a gruesome sight. The good news, clearly, is that my prediction has come true and both gold and senior miners have leaped into the limelight. 

They are happily basking in their new role as safe haven beacons of safety for smart money investors.

Double-click to enlarge this “Queen of Assets” gold chart.

While the stock market incinerates, gold is in a mighty uptrend. Note the fabulous flat line event taking place now on my 14,7,7 Stochastics oscillator at the bottom of the chart.

This type of technical action is extremely positive. The world’s mightiest metal is poised to surge above the uptrend channel supply line and roar straight to my $1300 target price zone!

(Click on image to enlarge)

Silver has held its own against the dollar and higher price enthusiasts will likely get the rally they deserve in 2019.

Because silver is used extensively in industrial applications, it tends to lag gold as the business cycle peaks. Demoralized stock market investors don’t see signs of aggressive growth in inflation yet, so they leave silver alone.

Once inflation begins to pick up more aggressively and US GDP growth contracts more substantially, silver will start to rally as aggressively as gold and the senior miners are rallying now.

I see that happening by the second half of 2019, but a three-day close over $15.20 would be a strong indication that commercial traders anticipate stagflation and are getting invested in this superb metal ahead of time.

As 2018 got underway, I urged investors to focus on President Trump’s success in the private sector and use his fabulous work ethic, organization, and planning skills as an inspiration to act professionally in the major markets.

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