Dr. Arnout Ter Schure
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Previously I was looking for GOLD to rally to $1820+/20 and then drop back to “ideally $1680-1620 before staging a multi-month rally to new all-time highs. Conversely, this rally has already started, but the market has not given us the all-clear signal that is indeed the case.” The $1820+/-20 zone was reached, but the bears were unable to push GOLD’s continuous contract prices below $1745, which was required to usher in the move to $1680-1620, and instead, the Bulls took the ball and ran with it. Thus, the rally to new all-time highs -although originally stated as lower odds- has IMHO already started.

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Figure 1. GOLD daily chart with detailed EWP count and technical indicators.

One last drop before the next rally commences.

As said in my previous article, see here, “The double bottom [in March] does present a bit of a twist. It can mean the entire correction has already been completed and blue wave-V to the low- to mid-2000s is already underway (exemplified by the blue dotted line).” Given the strength of the current rally, albeit it has not broken back above the 200-day Simple Moving Average (SMA) and the upper grey trendline of the downtrend channel price has been in since the July 2020 top, as well as the internal -impulse, looking- wave structure I view the double bottom in late March as the completion of the eight months’ long correction.

Ideally, but not necessarily, GOLD should soon rally marginally higher to around $1860 for a last, smaller wave-degree, 5th wave to complete (back) major-1/a. Then we should see a multi-week retrace back to ideally $1745-1790 for the major wave-2/b, before major wave-3/c takes hold and rallies price to ideally $2045-2090 depending on where wave-1/a tops and wave-2/b bottoms: see dotted black arrows in Figure 1 for the anticipated path.

Bottom line: The Gold Bugs were careful and did not allow GOLD one last time to ideally $1680-1620 before staging a multi-month rally to new all-time highs. Instead, they held the 50-d SMA and rallied price to new uptrend highs. This price action strongly suggests a new, more significant impulse move (see here) has started that should top shorter-term around $1860, drop to $1745-90 before rallying to $2045-90. As long as the Bulls can hold $1725 on any pullback, they are in control.

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