Well, not a Merry Christmas for gold buyers just yet. We have said in our TMTF forecast service to watch 1190 as KEY support and 1241 would also need to be taken out on a closing basis before we could confirm a new uptrend in gold and the end to the 5 wave bear cycle.
We have been writing about the bottoming process of the Gold Bear Cycle since Dec. 4, 2013, and our most recent article on Dec. 26 reiterated that the best time to accumulate the Gold/Silver stocks was in the December and January window.
We are seeing patterns in gold commiserate with what Elliott Wave Theory calls a “truncated 5th wave” pattern. All bear cycles have 5 full waves to the downside from the highs, and we have been in wave 5 since the $1,434 highs.
Many heads have rolled trying to call this recent near two-year downdraft in gold in terms of bottom callers, me included. I thought we would never get much below $1,440 or so from the $1,923 highs, but alas we all know we did
The S&P 500 has been on a tear as we all know especially since the S&P 500 bottomed at 1343 several months ago. This larger picture Bull Cycle started in March of 2009 interestingly after an exact 61.8% Fibonacci retracement of the entire move from 1974 to 2000 lows to highs.