Gold update 2015

After Gold and Silver topped in 2011 many have been looking for a sustainable rally to trade, or exit long term positions. Yet the decline in the precious metals has been generally steady except for a few quick rallies here and there. We have also been looking for a Primary wave A low since last year as well. But each uptrend since then has been short lived or sold off substantially. Since the wave pattern on this four year decline has been quite complex we recently looked at Platinum to possibly get some clues about Gold.

Historically, Platinum and Gold have generally moved together, with Platinum sometimes selling at a discount to Gold and most time selling at a premium. It is at a discount now.

A review of the 1980-1998 bear market displays this relationship quite well. Notice all the bottoms of the Primary waves, in both Gold and Platinum, occurred in the same years, with the exception of the beginning of the bull market. During the bull market Platinum started early, in 1998, which led to a fifth wave failure in 2011. Gold started in 2001, and had a clear five waves up into 2011. From the 2011 high in Platinum it has had a Major a-b-c down, and is still declining. This suggests to us, Gold is not finished with its Primary wave A decline either. Therefore we would expect Gold to make lower low, or retest the low, before its Primary wave A ends. The low so far is $1,130.

A review of the weekly Platinum chart suggests a potential support level at $1,075. This is where Int. C = Int. A, during Major wave C. When a similar count is applied to Gold there is potential support at $1125. This is where Int. C = 0.50 Int. A, during Major wave C. With both metals not that far from their potential lows, we should know fairly soon. You can follow the metals with us on pages 9 and 10 using the following link:

http://stockcharts.com/public/1269446/tenpp/10

Filed under: selected charts