Gold Stocks: A Pause With Grace

1. Gold and mining stocks are overbought on a myriad of charts and “the world’s most predictable pause and pullback” is underway.
2. Chinese futures market traders are now as much price maker as taker… and their margins have been hiked. That’s the primary reason for the pause in the action.
3. Please click here now. There are also concerns that tomorrow’s Fed meet could be a hawkish event.
4. Please click here now. Those concerns are exacerbated by the fade of inflation (at least in official numbers) in Europe. That could theoretically put pressure on the euro and boost the dollar.
5.  Please click here now. Click to enlarge. In the big picture, the intermediate term zigs and zags aren’t that important.
6. All fiat is clearly on a long-term road to a place best described as financial Hades versus gold.
7. That fact means that when it comes to currency, all investors need to make it their prime directive…
8. To get more gold.
9. To help accomplish that task, please click here now. Click to enlarge. On this weekly chart, I highlighted the right shoulder action on Stochastics that was both the technical launchpad for the breakout over $2100 and rocket fuel for the surge to the $2400 target zone.
10. This type of technical action often produces a bull flag pattern, and that's likely what is happening now.
11. While there’s no guarantee that it plays out as indicated, investors should be open to a “sell in May and go away” event for the US stock market, and a gentle drift sideways or down for gold.
12. Please click here now. Click to enlarge. Here’s another look at the flagpole and potential flag pattern, via the weekly close chart. Simply put, the price action is magnificent!
13. Please click here now. Click to enlarge. With the BPGDM sentiment index above 80 and its RSI at 97, what’s the next move for investors?
14. I suggest waiting for a return to the 50 zone for the index and 30 or lower for RSI. If that happens as gold arrives at my buy zone of $2220, buyers of gold, silver, and miners should fare quite well.
15. I’m a buyer of the “fizz” (physical gold bullion) at $2270… regardless of how overbought the market may still be. That’s because a dip from $2440 to $2270 is roughly a 7% price sale.
16. That’s enough for all physical gold enthusiasts to take bold action and get more of the world’s greatest metal.
17. A daily focus on the big picture is critical for investors as inflation, recession, the 2021-2025 war cycle, a wildly overvalued stock market, debt ceiling horror, and empire transition dominate the investing landscape.
18.  The Fed meet is important, but the Indian election is likely even more so. The winner is now scheduled to be announced June 4, and the nation’s citizens are likely to return to the gold market then.
19. The next four weeks could see gold complete its bull flag pattern around that June 4 date. Long ago, I dubbed the citizens of India as the world’s “titans of ton” because of their obsession with getting ever-more gold…
20. But only buying with size when it goes on sale.
21. What about silver? Please click here now. Click to enlarge. Silver hasn’t done as well as gold, but the monthly chart is fantastic.
22. A very bullish drifting rectangle (almost a bull flag) looks to be next for gold’s “little brother”. If gold trades at $2220, silver bugs should consider buying more silver.
23. Please click here now. Click to enlarge. The GDX daily chart suggests that even if a bull flag forms for gold, the miners could go higher while that happens.
24. The buy zone for GDX and associated senior miners is a price of about $2220 for gold but “times are changing”, and instead of collapsing as has happened in the past, gold stocks are pausing and correcting with grace!

Thanks!   

Cheers

St