Gold Price Forecast – Approaching A Bottom
Gold’s Cyclical Nature
As with any financial asset prices go through periods of range expansion and contraction – think of it like breathing. As prices rise, the market inhales – as they correct, it exhales. The natural progression in gold tends to shape bottoms every 6-months.
Below is a weekly chart of gold from 2007 to 2012. The blue arrows represent 6-month lows. Of course, not every cycle is equal, but take note of the cadence or rhythm to each low.
The Approaching Low
The last 6-month low arrived at $1267.30 in early May. The current technical setup favors one final decline into early December to complete this cyclical correction. During the next advance, gold should challenge $1600+.
The Close-Enough Approach
Picking the exact 6-month low is difficult, more so now than ever. Today’s markets are highly reactionary – a result of social media. One day stocks rally on thriving trade negotiations; the next day, they crash after a Trump tweet. Predicting these events is futile.
Consequently, I’ve adopted a “close enough” approach. When gold gets within striking distance to a 6-month low, I say close enough and begin adding to my metal’s portfolio. To determine the suitable “striking distance,” I wait for the Gold Cycle Indicator to drop below 100. The GCI closed at 94 Tuesday November 12th (currently back up to 118).
AG Thorson is a registered CMT and expert in technical analysis. He believes we are in the final stages of a global debt super-cycle. For more information, please visit https://goldpredict.com/
