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Gold & Silver Still Bearish Short-Term, Then Going Skyward


Gold Market Analysis

Weeks ago, after we bottomed at $2326 in Gold, I stated that I expected a rebound in Gold to $2400, then down to $2300 or below. Well, we just hit $2395.

Yesterday, I ran an A-B-C count for the peak of wave B and I got this:


A peak at $2395, rounded up that’s $2400. Then if I do the same A-B-C for wave C using $2400 for the peak, I get $2272 on the downside, close enough to $2280:


The point being that despite the rally in Gold over the past couple of days, it looks like it still has a date with $2300 or more likely around $2280 for the bottom of wave C and wave 4.


Possible Breakout Scenario

However, if we do break $2400 easily and continue higher, then the bottom is very likely in place and we’re going much higher. But if it turns down from $2400 or thereabouts, then the target is $2300 at a minimum, in my opinion.

gold futures june 6 2024


Impact of Rate Cuts on S&P and Gold

I also see that the S&P is at new all-time highs on higher rate cut expectations, following the Bank of Canada’s cut today and likely the ECB’s cut tomorrow. The S&P is also extremely bullish and the VIX looks ready to pop. All it is waiting for is a catalyst for a correction, and the Payrolls fit the bill. If we get a higher-than-expected Non-Farm Payrolls number on Friday, rate cut expectations collapse, and down goes the S&P. But the metals and miners could sink also, like a lead balloon to lower lows. Watch the 10Y and DXY rise also.

gold futures june 6 2024


Predictions for Gold, Silver, and GDX

The fact is that I am not sure if the bottom is in or not for Gold, Silver, and GDX, but I have serious doubts backed up by data that suggest we’re going lower again before higher, MUCH higher. If Gold does drop to $2300 or below, Silver and GDX are heading down to $29 or less and $32 or less, in my opinion. Then it’s blast-off time!

Whereas if Gold closes above $2400, the bottom is likely in and we go straight up.


Final Thoughts on Precious Metals

Final comment, with markets becoming bullish on the possibility of a rate cut by the Fed, it would not surprise me if they pull the plug from under everyone with a surprisingly high Payrolls number on Friday. That said, I would not recommend shorting but use such reversals to buy the dips because we are going up to new highs next, in my opinion.

Don’t miss a golden opportunity.

Now that you’ve gained a deeper understanding about gold, it’s time to browse our selection of gold bars, coins, or exclusive Sprott Gold wafers.

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About the Author

David Brady has worked for major banks and corporate multinationals in Europe and the U.S. He has close to thirty years of experience managing multi-billion dollar portfolios including foreign currency, cash, bonds, equities, and commodities. David is also a CFA charter holder since 2004.

Using his extensive experience, he developed his own process utilizing multiple tools such as fundamental analysis, inter-market analysis, positioning, Elliott Wave Theory, sentiment, classical technical analysis, and trends. This approach has improved his forecasting capability, especially when they all point in the same direction.

His track record in forecasting Gold and Silver prices since has made him one of the top analysts in the precious metals sector, widely followed on Twitter and a regular contributor to the Sprott Money Blog.

*The author is not affiliated with, endorsed or sponsored by Sprott Money Ltd. The views and opinions expressed in this material are those of the author or guest speaker, are subject to change and may not necessarily reflect the opinions of Sprott Money Ltd. Sprott Money does not guarantee the accuracy, completeness, timeliness and reliability of the information or any results from its use.


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