Gold Going To $3000!
GDX has been on a rally which many think was a major bottom as the above analyst thinks gold is going to $3000 soon. What these crazy forecasts are telling us is that the US dollar has to implode in a major way, before gold ever breaks out again. The 2011 peak was already a gold/silver mania peak which I documented very well. At that 2011 peak, the majority of analysts were all extremely bullish yet gold stocks imploded ignoring all the fundamentals. Most people couldn’t tell you what caused the decline after 2011, and I bet they still can’t tell you what lifted GDX in early 2016!
Sure GDX formed a bottom and it even has a decent “C” wave decline, but that doesn’t mean that GDX is in a real bull market! In a 4-year + decline, gold stocks had many rallies and they all resumed their larger bearish trends. It may take the rest of this month, but any new bottom will help make my bearish case. The US dollar is in a bull market that very few understand, as the US dollar bull market represents “deflation” not inflation. Any emotional gold buying moves will never last as they are not based on sentiment, but based on fear! Gold investors will run like chickens if this bottom does not hold.
The Gold/Gdx ratio is not all that bad at 66.54:1, but this ratio should expand much more before gold stocks become very cheap again.
You may be hearing about US treasuries being dumped or sold off, but when the bearish news is rampant, and more rate increases seem imminent, then the markets do the exact opposite and reverse their trends. The bull market has reversed after every major crash or correction since 1981 and I’m sure it’s doing it again. T-Bonds hit a bottom on Oct, 9th at the 136.500 price level, and so far it’s still holding. It’s not about rates rising that is killing the “T-Bonds”, but it’s the falling T-Bond prices that forces or allows the Fed to increase rates. The Fed is basing all rate increases on lagging indicators and if I’m right then sooner or later they will have to “pause”.
Since the 2000 crash bottom, we have had a solid bull market with some wild and crazy overlapping wave structures. “All” commodities can create these choppy waves, and that has been going on since the Little Ice Age bottom in 1500 CME. T-Bonds are on a Supercycle degree wave 3 rally that has 120-year cycles to them. From the 1861 peak, T-Bonds took 120 years to complete a zigzag correction, and I’m sure the next real bullish phase top will not happen until 2101! 2041 would be a 60-year top and my Supercycle degree wave 3 peak. Of course, I can never confirm that as that would be a job for a very young analyst to do.
Two years and 6 months with well over 1 million page views, not a single budding wave analyst has expressed any interest in switching to Cycle degree wave analysis. With this lack of interest, chances are good I may shut down this blog permanently once solar cycle #25 starts to crank up in 2022.