Gold Market Update
It now looks like gold’s correction is done and its intermediate base pattern is completing, and if so then we are at an excellent entry point for many better PM stocks, which have been savagely beaten down over the past several months - a necessary correction following their outsized runup earlier in the year.
On its 1-year chart we can see that gold’s corrective action from early July has brought it all the way back to its steadily rising 200-day moving average, a classic buy spot, where a potential intermediate base has formed. This corrective action has more than completely unwound the earlier overbought condition and it may well be that the price is bottoming at the lower boundary of the large parallel uptrend channel shown, and that is what various factors suggest. These factors are the major uptrend still in force as symbolized by the rising 200-day moving average already alluded to, the bullish alignment of moving averages, the price being at the lower boundary of the prospective channel shown, the earlier overbought condition having unwound, and finally the dollar looking like it is breaking down from its uptrend of the past month, which we will look at later.
End of update.