#003-2.1 DARK HORSE GOLD SWING RALLY (TAPER TANTRUM PART DEUX??)
In development of my PRS wave theory, there is something nagging me about the wave decompression of the rally that topped August 7, 2020. While this is not what I expect to happen next, it resolves all my quant concerns before completely discounting a bearish thesis . This type of price action is ALWAYS event-driven. A possible trigger that has appeared recently seem to be a Fed surprise ala 2013 temper tantrum which they will have to walk back 180 degrees 3 weeks later.
Notes:
1. My base case is: the U.S. has no choice but to print trillions to fund an economic revival. Trillions have been printed, and trillions more will be printed. This is fact.
2. Debt to GDP is 125% and rising quickly, the only choice is to inflate debt away. All other choices are political non-starters. This is fact.
3. Gold will go to 10K or higher by 2025. This is thesis.
My research has shown that each super-cycle has its own "base rhythm" which can be reduced to bar size. For this cycle we are in, it is 1-WEEK BAR. If I zoom in 27X, I get this chart you are looking at above on 258-min bars (don't ask why, I wouldn't say anyway). The 1 GIGANTIC problem is that orange wave layer in this chart is in RE-COMPRESSION mode. It was decompressed in an irregular manner due to:
1) the crash in Feb/Mar 2020 to 1450 and,
2) the resulting swing all the way to 2075 by August 2020.
While this decompression rally move the 12- to 13-years regressions to break out mode, it moved the 365-trading day (not calendar days) regression wave to re-compression mode if the resulting correction takes too long. How long should it take? For the current cycle, 14 to 19 weeks. The problem with this? It has been 32+ weeks since the August 07th high. While the long term regressions has not even moved a needle (suggesting that the next rally tops above 2650-3000 as early as Jan/Feb 2022), the 365-trading day wave layer (not particularly important in other scenarios yet is the denominator of this scenario) is a point for "normal" price action. In other words Gold prices are way past due for a rally to prevent this extreme swing, in which the orange wave crashes and is immediately and strongly rejected upwards by ALL OTHER WAVES BENEATH IT. I call this process, "wave rebalancing".
Obviously, we will know soon what happens next, because this projects prices to 1550 area before April 8th and reverses to to 2050 BY MAY 4TH. Won't have to wait long to find out.
Notes:
1. My base case is: the U.S. has no choice but to print trillions to fund an economic revival. Trillions have been printed, and trillions more will be printed. This is fact.
2. Debt to GDP is 125% and rising quickly, the only choice is to inflate debt away. All other choices are political non-starters. This is fact.
3. Gold will go to 10K or higher by 2025. This is thesis.
My research has shown that each super-cycle has its own "base rhythm" which can be reduced to bar size. For this cycle we are in, it is 1-WEEK BAR. If I zoom in 27X, I get this chart you are looking at above on 258-min bars (don't ask why, I wouldn't say anyway). The 1 GIGANTIC problem is that orange wave layer in this chart is in RE-COMPRESSION mode. It was decompressed in an irregular manner due to:
1) the crash in Feb/Mar 2020 to 1450 and,
2) the resulting swing all the way to 2075 by August 2020.
While this decompression rally move the 12- to 13-years regressions to break out mode, it moved the 365-trading day (not calendar days) regression wave to re-compression mode if the resulting correction takes too long. How long should it take? For the current cycle, 14 to 19 weeks. The problem with this? It has been 32+ weeks since the August 07th high. While the long term regressions has not even moved a needle (suggesting that the next rally tops above 2650-3000 as early as Jan/Feb 2022), the 365-trading day wave layer (not particularly important in other scenarios yet is the denominator of this scenario) is a point for "normal" price action. In other words Gold prices are way past due for a rally to prevent this extreme swing, in which the orange wave crashes and is immediately and strongly rejected upwards by ALL OTHER WAVES BENEATH IT. I call this process, "wave rebalancing".
Obviously, we will know soon what happens next, because this projects prices to 1550 area before April 8th and reverses to to 2050 BY MAY 4TH. Won't have to wait long to find out.
הערה
QUICK LOOK:הערה
QUICK LOOK ON VOLUME MAP ON 258-MIN BARS FOR SPOT/FUTURESהערה
XAUSSD has is "beginning" to suggest a bottom is developing. But futures say HARD RUG PULL COMING!!
כתב ויתור
המידע והפרסומים אינם אמורים להיות, ואינם מהווים, עצות פיננסיות, השקעות, מסחר או סוגים אחרים של עצות או המלצות שסופקו או מאושרים על ידי TradingView. קרא עוד בתנאים וההגבלות.
כתב ויתור
המידע והפרסומים אינם אמורים להיות, ואינם מהווים, עצות פיננסיות, השקעות, מסחר או סוגים אחרים של עצות או המלצות שסופקו או מאושרים על ידי TradingView. קרא עוד בתנאים וההגבלות.