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Avi is founder of ElliottWaveTrader.net, a live trading room and member forum focusing on Elliott Wave market analysis. Avi emphasizes a comprehensive reading of charts and wave counts that is free of personal bias or predisposition. A lawyer and ... more

Metals Bottoming In The Upcoming Week?

Date: Tuesday, May 9, 2017 8:07 PM EDT

This now brings me to silver, which is a little problematic for me.  Silver has now dropped deeper than makes me comfortable.  Ideally, I would not want to see silver break below the December low of 15.80.  Should we see such a break, it would make me begin to question the larger bull market thesis.  In fact, when the management team of our EWT Miners Portfolio met this past week, we saw dramatic differences in the structures of the gold miners relative to the silver miners.  When we reviewed leading charts, such as ABX, they are retaining quite nice, textbook a-b-c pullback structures in their respective 2nd waves.   However, the silver miner charts, while are also dropping correctively, have not retained the same “pretty,” textbook structures. This does suggest that we should proceed with caution, but I still would expect a bottoming in the near term within the complex.

While we still can see one more 5th wave decline based upon the smaller degree charts I am tracking, I would want to see a bottom struck in the coming week, followed by a strong 5 wave move off those bottoming structures in order to retain a strong long term bullish bias. Moreover, as noted before, GDX probably has the cleanest of the charts, and while it suggests that we should remain over the 20.30 level, a break down below 18.58 would truly shake my conviction in the fact that a long-term bottom has been struck in the complex.  

See charts illustrating the wave counts on the GDX, GLD & YI.  

Avi Gilburt is a widely followed Elliott Wave technical analyst and author of ElliottWaveTrader.net (www.elliottwavetrader.net), a live Trading Room featuring his intraday market analysis (including emini S&P 500, metals, oil, USD & VXX), interactive member-analyst forum, and detailed library of Elliott Wave education.

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