Metals and Miners Bide their Time

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With little in the way of events over the holiday period, I’ll keep this week’s report brief…

GOLD

Gold is currently trading at 1815. If we close here, it’ll be a higher high and the highest close since November 19 at 1852. That said, we’re still trading around the moving averages. A break above 1880 would go a long way to confirming that the bottom is in. But the risk of a dump in stocks remains a potential catalyst for further downside.

SILVER

As forecast, Silver ran into resistance at its 50-day moving average following its rally off a positively divergent double bottom and a break of resistance at ~22. Support is now at 22.60. A break above the 50-day moving average followed by a higher low would go a long way to signaling a green light for the rally to the 30s next.

GDX

Same story, different asset. GDX has run into resistance at its 50-day moving average. Above there awaits the 200-day moving average providing resistance at ~33. The all-clear signal I’m looking for is a break of above the prior high of 34.50. Support at 30.84 and 30.15.

SILJ

SILJ hasn’t even reached the 50-day moving average but I certainly would rule out a test of it. 12.76 is resistance ahead of that. Support is at 12.08 and 11.81. Again, I am looking for a higher high above the 50-day moving average, then a higher low, and then a break of the previous high of 14.50 to set us up for the rally to 25-30.

At the risk of being a broken record, I am patiently waiting for dump in stocks, oil, bond yields, and a reversal in Fed policy to more QE to truly kick off the next rally in metals and miners. It’s inevitable, imho, perhaps driven by another general lockdown as in March 2020. The only alternative is a systemic collapse of everything.