Get 40% Off
🚨 Volatile Markets? Find Hidden Gems for Serious OutperformanceFind Stocks Now

Gold Eyes Thunderous Rally as PCE Report Looms

Published 02/28/2024, 01:57 AM
Updated 02/07/2024, 08:50 AM

With Thursday’s US PCE report dead ahead, whipsaw action could be a big gold market theme this week.

OUNZ-Weekly Chart

Having said that, a significant rally appears imminent. OUNZ) ETF (gold bullion proxy) chart. A rare inverse H&S pattern is in play for the Stochastics oscillator (14,5,5 series) and a Friday close above $20 should ignite a thunderous rally to $24 for OUNZ and $2400 for gold.


After stalling in the 50 zone, the BPGDM gold stock sentiment index slipped to under 20.

Also, note the RSI oscillator at the top of the chart. It’s been deeply oversold for about two months. 

This type of sentiment action tends to be followed with massive rallies in the miners and features the BPGDM soaring to above 70.Gold Price Chart

What about the dollar? This is the most important dollar chart in the world and fiat bugs should use it to face their folly.

The bottom line: Over time, all fiat currencies end up looking like train wrecks on gold bullion tracks. 

Sadly, most investors spend their time trying to get more fiat instead of more gold. The fiat they get then fails against gold and their hard investing work is in vain.BTC/USD-Daily Chart

What about crypto? Like commodities, stock markets, and miners, bitcoin is a tool a tool to get more gold.

The ETF launch has brought significant institutional money into the bitcoin ecosystem. It’s similar to what happened to gold stocks after the 2006 launch of GDX. Bitcoin has been demonetized with the launch, but patient investors can buy it on the big price sales that are destined to occur. An Elliot “C” wave is in play and that means the price is set to rise to $100,000+.

3rd party Ad. Not an offer or recommendation by See disclosure here or remove ads .

Sloppy crypto investors won’t use any of their profits to buy more gold. They’ll look for a new scheme to make even more fiat one that will eventually go awry. FXI-Daily Chart

All proper investing, in a nutshell, is about getting more gold. What about the world’s stock markets, can they be used to get more gold? The Chinese stock market (FXI) daily chart. A significant inverse H&S bottom is in play.FXI-Weekly Chart

A look at the weekly chart. The $20 area is massive support and rate cuts (and fiat money printing?) could fuel a huge rally. That rally could be the start of a bull run like America experienced from the 1930s until the 1966 area high.INDU-Weekly Chart

The US stock market (Dow) chart. Traders may be able to use this market to make some big profits by betting it falls.

I’ve highlighted all my major buy zones on the chart and all of them feature RSI at about 30 or lower. It’s above 70 now. Basically, the US stock market is now best described as a wax-winged Icarus with a nosebleed. I ask investors to contrast that picture with the gleam and righteousness of gold!

This is an area for selling, shorting, and put options. The next buy zone likely happens with the Dow down at least 10,000 points from the highest point that it reaches on the current upside run.

What about the miners? Well, Western gold bugs are as passionate about mining stocks as Chindians are about 22k-24k jewelry, and rightly so.

3rd party Ad. Not an offer or recommendation by See disclosure here or remove ads .

The good news is that a true barnburner of a mining stock rally appears imminent. 

GDX-Daily Chart

On the daily chart, GDX is showing all the classic signs of a double bottom pattern in the making.

There’s big volume on the first bottom that was created by CPI report panic a couple of weeks ago. The second bottom likely occurs with Thursday’s PCE report. GDX-Weekly Chart

The weekly chart is even more impressive than the daily. There’s inverse H&S action for the price and the Stochastics oscillator is now fully oversold.WTIC-Daily Chart

Oil has been trading in sync with the dollar and opposite to gold. That’s mainly due to concerns about a global recession.

Gold stock investors should watch this oil versus dollar index chart closely because the next divergence is likely to be a major inflationary trigger.

What lies ahead for America is likely 1970s stagflation on steroids, and Thursday’s PCE report just might be golden trigger day!

Latest comments

Extremely accurate analysis. Gold price rally exactly as predicted after PCE report. I read it, but didn't give due importance to it.
what about the historical support not yet retest
gold first look for 1972
gold price 2041$? anyi chans today?
Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.