Time For A Bounce?
By
Avi Gilburt
For quite some time, the GLD daily chart has really been quite “golden” in lighting the path for the market turns.
If you remember, I was expecting a major low in the 4th wave as starting moving into the 4th quarter of 2022 based upon the GLD chart. Then, as we were approaching the end of January, the GLD chart was suggesting we were primed for a pullback, despite the extreme bullish sentiment abound at the time. And, most recently, the GLD chart was rather clearly suggesting it was again time to expect a pullback.
While the MACD on the daily GLD chart is now approaching the top of its support region, I really do not think the structure suggests that this pullback has run its course. Rather, I think we are just completing the a-wave of the current pullback. This leads me to consider that we can push a bit higher for a b-wave, followed by a c-wave to complete this a-b-c pullback.
When we look at GC, we see pretty much the same thing. Ideally, I would like to see a bit more of a b-wave bounce, followed by a c-wave decline. Yet, we clearly have to be aware that there is a reasonable breakout potential on the chart as well. And, should the market break out through the pivot before a c-wave down, I will not fight price. Yet, for now, my expectation remains to see more of a pullback in the coming weeks.
Silver is set up now for a c-wave rally, as long as today’s low holds. Again, I expect this c-wave to complete a [b] wave bounce. And, as long as we remain below the recent highs, I will continue to expect a [c] wave decline thereafter.
I want you to also take note of the change I made in the more immediate bullish count. This consolidation has lasted too long to be the 4th wave of the degree which I was showing before. At this point, we are large enough to consider it as a 2nd wave, which I labeled as a potential wave [ii] of 3 of iii. This provides us with much greater extension potential should we see a break-out sooner rather than later, as a minimum target for wave [iii] should be AT LEAST the 31 region, and potentially even higher based upon the manner in which silver traditionally runs after very long consolidations.
GDX is relatively straightforward as well in my expectation for more of a 2nd wave pullback. And, should we see that pullback, then I prefer the targets noted on my daily chart for waves [3], [4] and [5] of wave 3.
Overall, my perspective maintains an expectation for a potential bounce in a b-wave, followed by a c-wave decline to complete this pullback in the complex. Of course, price will lead the way. And, should the market provide us with a break out sooner rather than later, then we will be forced to adjust to a more immediate bullish view of a heart of a 3rd wave taking hold sooner than expected. Either way, I am still expecting much higher levels to be seen in the complex this year.
