2/11/2019 - Break Out and Projections

This week action seems like a confirmation of the bottom and could signal a new rally that should go deep into the Christmas period.

USERX
Userx generated a new 35-39 buy index inside the ongoing 92-96 true bull market. For the bull to stay alive price needs to be above 9.35 by the 12th November (35-39) and be above 9.88 by the 15th January (92-96).

In order to maintain the 881-885 buy (important because it is showing a very
long term border between a bull and a bear) it needs to be above 10.28 by the 5th February 2020.

If my theory is correct that gold is carving out a gigantic shallow pan pattern then the upcoming targets are 10.28, 13.75 and ultimately 22.11 (Dec 2010 top). Based on symmetry that final top should be approximately 2 years and 2 months away from a period when we achieve 10.28. That would be around 2021 Christmas time.

HUI 

Same as USERX

XAU

Same as USERX

GDX

Slightly different, it is about to generate a double buy 16-20 and 35-39.

GDXJ

same as USERX

GLD

same as USERX

UUP - dollar

The dollar is still in the bull market but the touch of the 2008 top at 27.19 turned out to be poisonous. The chart still looks weak so, if we are starting a new rally in gold, maybe we should see a test of the 92-96 echo. I wouldn't be long the dollar here.

TLT - 20y bonds

TLT is looking similar to gold. It should buy the 35-39 inside an ongoing (197 days) 92-96 bull market.

SandP

It is not too late for a turn around but this chart definitely looks like a breakout. While a danger of producing a triple sell seems gone we cannot say that this chart is completely fixed. A new 16-20 buy followed by further lower price can generate a dangerous double sell, 35-39 and 92-96.  We will see what happens. I will monitor the transport index to see if this rally produces new high and consequently mitigates the Dow Theory problem discussed in the last update. The whole setup looks promising especially considering the 218-222 index.

XGD - Australian Gold Index

Australian Gold barely missed a 92-96 sell. A small down day on Monday would still produce the sell. For the last two weeks while USA golds have been surging the Aussie golds were dropping. This finally reversed the trend where the Aussie market was leading. This rare situation was due to gold and the US dollar rallying together causing a boost in Australian gold shares performance. The decoupling between gold and the USD, if it is finally happening, should cause the Aussie gold market to lag, as it normally would. 

If my reading of the signals and index positioning of the last few weeks is correct and new medium term trends were established we should see gold, bonds and general market rising while the dollar is struggling.

Long and strong here.

Best luck to everyone!