Cycle Trading

Gold appears to be in the process of forming a weekly swing low this week.

At 27 weeks, a weekly swing low has good odds of marking the intermediate cycle low. A clear and convincing break above the declining trend line is needed to confirm the new intermediate cycle. But gold will need to deal with resistance from the declining daily 50 Moving Average first.

Gold printed a left translated 18 day daily low on 12/31. Gold formed a swing low and a break of the declining daily trend line the next trading day. That confirms a new daily cycle. How gold negotiates the declining daily 50 MA will go a long way in determining if a new intermediate cycle has started. A clear and convincing break above the declining 50 MA helps gold to reestablish a bullish posture. Then gold’s next target would be breaking above the previous daily high of 1267.7. Should gold accomplish that then it will have broken the trend of lower daily cycle highs.

The Miners have been leading gold out of this cycle low. The Miners printed day 1 back on December 20th. Then broke above the declining trend line to confirm a new daily cycle on 12/26. While gold printed day 3 on Friday, the Miners printed day 9 on Friday. At day 11, the Miners are creeping up on the declining 50 MA. If the Miners can power through this resistance zone that would be a very bullish signal.