Despite gold’s ongoing lackluster trade and still lower prices, my AI models for gold continue to clearly point to a soon-to-arrive rally. One that could be very strong indeed.
Here’s the chart, produced at 2:20 am EST.
You can clearly see the projected rally and the dates for the swings during the rise. But overall the trend should be higher well into late March.
However, the rally showing from December 9 to January 4 on the left side of the chart appears to be shaping up as the most important. Other models I monitor like Relative Strength and Stochastics are looking positive, but they are also showing the potential for another sharp decline into the end of January.
We may, as previously discussed, see gold continue lower into the January 25 low you see on this AI chart, even to below $1,000 – before the rally can come. It’s too early to say.
But a rally is coming, big time. And it could come at any moment, or as late as the end of January.
At this time, I would actually prefer to see gold bounce slightly, enough for me to recommend exiting UGL and then reversing into a short or inverse ETF heading into January 25.
And then going aggressively long for the rally into April and beyond. That would be the ideal pattern.
But for right now I recommend holding UGL. Do not add to the position and maintain your GTC protective sell stop at $31.39.
Also hold DXD and TMF. The Dow Industrials are tiring and getting ready to roll over back down, beneficial for DXD … while now that the Fed is out of the way, we should see a healthy bounce back up in bond prices, which would naturally be good for TMF.
Be patient, iron-cladded, and stay tuned in …
Best wishes,
Larry
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