Gold Price Forecast: Uptrend Resumes After Achieving Mid-Year Lows

The Treasury announced a buyback program Wednesday aimed at suppressing yields on longer-term bonds.

In response, the dollar fell below its 200-day moving average, while precious metals surged, with miners leading the move.

Bitcoin rallied sharply as well, triggering significant short covering. Near-term cycles point to a potential top next week, and I’m still anticipating a final flush into October—but my conviction in that scenario is beginning to wane.

The Gold Cycle Indicator finished at 119 – prices exited cycle bottoming.

Gold Cycle Indicator rises to 119 as prices exit cycle bottoming. Source: GoldPredict.com.

The Dollar Slipped Below the 200-Day Moving Average

US DOLLAR: The dollar slipped below the 200-day moving average following Wednesday’s Treasury buyback news, supporting the case for a major top in June. I expect occasional rebounds, but the overall downtrend should resume, with prices likely dipping below 90 next year.

U.S. Dollar Index falls below its 200-day moving average after a potential June top. Source: StockCharts.com.

Oil Is Testing the Upper Boundary

WTIC: Oil is testing the upper boundary, and consecutive closes above $88.00 would support a breakout. Such a move could push inflation higher, putting upward pressure on long-term Treasury yields.

WTI crude oil tests the upper boundary, with $88 in focus for a potential breakout. Source: StockCharts.com.

Gold Formed a Major Low Mid-Year

GOLD: Gold formed a major low mid-year, as forecasted, and the uptrend is now resuming. While it may take some time for prices to sustainably reclaim $5,000, we expect gold to ultimately exceed $7,000 next year before reaching the next significant top.

Gold rebounds from a major mid-year low as the broader uptrend resumes. Source: StockCharts.com.

Silver Also Formed a Major Bottom Mid-Year

SILVER: Silver also formed a major bottom mid-year, as forecasted, and the uptrend is now resuming. We expect sideways price action and consolidation between $90 and $100 before silver moves on to new all-time highs next year, likely in the second half.

Silver turns higher from a major mid-year bottom and breaks descending resistance. Source: StockCharts.com.

Platinum Has Broken Above Its Cycle Downtrend Line

PLATINUM: Platinum has broken above its cycle downtrend line, confirming a major bottom. We expect resistance between $2,200 and $2,400 before prices move on to new all-time highs next year.

Platinum breaks above its cycle downtrend line after forming a major bottom. Source: StockCharts.com.

Miners Are Taking Over the Leadership Role From Gold

GDX: Miners formed their mid-year lows as predicted, surging more than 40% since bottoming. This confirms our outlook for continued outperformance and supports our view that miners are taking over the leadership role from gold. We expect miners to make new all-time highs well ahead of gold, likely before year-end.

GDX surges from its mid-year low as gold miners take the leadership role. Source: StockCharts.com.

Juniors Held Support at the 200-Day Moving Average

GDXJ: Juniors held support at the 200-day moving average, and it doesnt look like were going to get a meaningful pullback at this time.

GDXJ holds its 200-day moving average and extends its rebound from a major bottom. Source: StockCharts.com.

Silver Juniors Backtested the Trendline and Turned Immediately Higher

SILJ: Silver juniors backtested the trendline and turned immediately higher. July likely marked a major bottom, and I continue to believe prices will make new highs well ahead of silver.

SILJ backtests its trendline and turns higher after a major July bottom. Source: StockCharts.com.

Bitcoin Initially Surged on the Back of the Announced Treasury Buyback

BITCOIN: Bitcoin initially surged on the back of the announced Treasury buyback, then accelerated higher during a bullish White House crypto event. The result was massive short covering, with a record $3 billion in liquidations.

Short term, cycles support the potential for a top around August 25–26. However, with prices now back above the 200-day moving average, I can’t help but feel that one of my calls—perhaps both—may be wrong. Either prices won’t reach $40,000, or the bottom won’t come in October.

I still think we could see a final washout beginning in September. From a sentiment perspective, I believe Bitcoin needs to fall below $50,000 to fully eliminate the remaining bulls. If prices don’t trade sharply lower in September, then I’m wrong, and prices likely bottomed roughly three months ahead of schedule.

Bitcoin rebounds above its 200-day moving average as short covering accelerates. Source: StockCharts.com.

Bitcoin Balanced Price

Bitcoin has bottomed out every four years like clockwork, and in each cycle, prices have at least tested or fallen below the balance price, which is currently $39,880. That’s why I’ve been expecting a test of $40,000 for the past six months.

I still think there’s a very good chance we’ll see one more drop into October. Consequently, this could be the last pump before the final dump—but time will tell.

Bitcoin Balanced Price remains near $40,000 after marking prior four-year cycle lows. Source: Look Into Bitcoin.

Final Thoughts

Watch the price action surrounding Warsh’s Jackson Hole speech next week.

A pullback in metals and miners wouldn’t be surprising, but overall, prices appear to have marked major bottoms in June and July as predicted.

It will take time for gold to sustainably reclaim $5,000 and silver to move back above $100, but we expect both to make new all-time highs next year, with miners likely leading the way.

AG Thorson is a registered CMT and an expert in technical analysis. For more price predictions and daily market commentary, consider subscribing at www.GoldPredict.com.