Steady till...

It is time, once again, to review the evidence re the progression of the gold market. It has been twenty five weeks since gold hit a double top. Then it took a substantial correction. Someone else has figured out that the time it takes to reach a new high is proportional to the size of the correction. The high occured in August and 25 weeks has passed since then. The graphic analysis suggests an interval of 38-40 weeks untill the next high in gold price. This amounts to between 3 to 4 months more.

The first graph on top shows the gold price. The graph shows a breakout from the down pattern and a reaction to it. So, we wait to see if the next peak confirms the breakout.

The second graph shows the combined gold and silver issues. It, too, shows a breakout pattern, but then the graph goes back to the down trend line.

The next three graphs show two gold miners and a silver miner. We see the same pattern. Breakout waiting to be confirmed.

There are several reports that I will try to summerize. Many people and institutions have taken steps to have enough cash on hand to respond to what may come. The estimate is 7-9 Trillion dollars. No point investing it in Treasuries: the banks will give you 6% gain in 3 years and 9% loss during the same time because of inflation. The US Stock Market is the highest in 4 years, so there is nothing gained in buying stock. There are a number of possible events that could rock the boat. There is the real possibility of recession in Europe and even in the US. Should such occur, stocks will be clobbered, along with gold and miners. On the other hand, the ECB stands ready to inject $1T worth of Euros into the economies of Europr and the FED is ready to open the money spigots.

So, my calculations peg the start of the next big move in gold to start in about 3-4 months. Larry thinks so too.