Gold and silver have rallied since the prior analyses and are worthy of an update following Jay Powell’s pivot on monetary policy at Jackson Hole to begin cutting interest rates in September. The Financial Times is also onboard for additional price gains with “This Gold Rush Has Staying Power” published on Aug. 28. The WSJ’s opinion in 2015 that gold was only a “Pet Rock” is certainly over with all-time highs breaching $2,500 per ounce.

Let’s begin today with an excerpt from the “Gold and Silver Outlook for Late Summer 2024” (Twitter thread), a brief link garden of data points and commentary, an updated technical analysis on the gold and silver charts, gold’s performance vs. the dollar and U.S. stock market indices, and close with a recent David Hunter interview who now considers $3,000 gold as a conservative near-term target.

“The domestic and geopolitical situation is brewing to a boil while the dog days of summer approach an end that includes a treacherous war escalation on numerous warfronts, political upheaval amid an assassination attempt on Trump during the U.S. presidential election cycle, wicked volatility in stock markets, a definitive shift in market reactions to recession signals, and the Fed circulating Fedspeak along with pundits that forecast interest rate cuts could begin in September. It appears that a termination of the latest TaperCaper cycle in U.S. monetary policy is imminent, so prepare accordingly.” – TraderStef, Aug. 11

 

• Many Countries Turning to a “Stateless Currency” – Gold – Money Metals
• Gold rallies to record high on softer dollar, rate-cut expectations – Reuters
• Kamala’s Economic Plan Will Destroy the US Economy – Armstrong Economics
• 400oz Gold Bars Worth a Million Dollars for the First Time – Bloomberg
• Rich Snap Up Gold Bars, Storage Vaults Brace for Business – Bloomberg
• Josh Lipton: Only a matter of time gold reaches $3,000 – Yahoo Finance
• China’s strategic silver takeover to drain the west – Jerusalem Post
• Gold miners ‘ripe’ for a break out – CNBC
• Doves Are Scaring Away the Bears Out in Jackson Hole – Bloomberg
• Curious about how a sound money economy would look? – John Rubino
• Fed’s Powell Declares ‘Time Has Come’ for Rate Cuts – WSJ
• BofA: Gold outperforming tech, investors should keep buying – Business Insider
• Polish central bank becomes biggest buyer of gold – Euro News
• U.S. Treasuries not the safe bet they once were, research says – Reuters
• Peter Schiff Exclusive: Kamala’s Socialist Policies & The Crisis Ahead – QTR
• The American Dream is impossible no matter how hard you work – Daily Mail
• The La-La-Land Fairy Tale of a “Soft Landing” – Charles Hugh Smith
• False Flag Will Ignite World War III – Gerald Celente (video)
• Ukraine military: Western intelligence data used for cross-border attacks – NHK

Below is today’s technical analysis for gold and silver. Rips and dips in the dollar and breaking news events combined with the dominance of automated trading decisions, HFT platforms, and artificial intelligence radically influence price action across all financial markets in either direction at all times within microseconds and cause bouts of extreme volatility. Be mindful that a window of opportunity for swing or scalp trading precious metal ETFs, spot, options, futures, or mining stocks does not necessarily equate to timing for layering core long-term positions or purchasing physical bullion and coins. To view a larger version of any chart below, mouse over it and select or right-click and choose a “view image” option.

 

$DXY Dollar daily chart May 2021 – Aug. 26, 2024 NY open…

 

Gold Spot monthly chart Aug. 1999 low to Aug. 27, 2024 % gain vs. $DXY Dollar, Dow 100, S&P 500, Nasdaq 100, Russell 2000…

 

Gold Spot daily chart as of Aug. 30, 2024 close…

 

Excerpt from the Aug. 11, 2024 (Twitter thread) weekly chart analysis:

“Gold printed an all-time high (ATH) of $2,484 on Jul. 17 and settled at $2,430 into Friday’s close. The dominant chart pattern continues to be a Flag Tilt with strong dip buying on higher lows that have followed higher highs since Apr. 12. When the price action was about to challenge the ATH on Aug. 2 and break out of the Flag Tilt, a selling panic in Japan’s stock market ensued overnight that followed the Magnificent Seven stocks and recessionary data beating down U.S. stocks since July. Markets in the U.S. were subsequently pummeled on Aug. 1-5. What occurred in Japan was a manifestation of the initial yen panic on Mar. 27 that has been annotated on my charts since that day. Gold buying quickly returned in earnest on Aug. 5-9. The reasoning behind the secondary Throwback that began on Aug. 2 is a topic I have explained numerous times, and the mainstream financial press duly noted that cause on this occasion. Note that gold and U.S. debt markets are two of the largest and most liquid on the planet, which makes them targets for cash when needed.

Gold Plunges as Global Equity Mayhem Sets Traders on Edge… “Virtually every time there is marked equities weakness, investors who hold gold as a risk hedge will liquidate part of their holdings to raise liquidity against any potential margin calls. When the dust settles, they almost invariably buy it back.” – Bloomberg, Aug. 4

It is also relevant to note that gold’s seasonality pattern is firmly intact for 2024 so far. The reason why some market observers mistakenly claim otherwise is because they misread what a seasonal chart represents. It reflects the up and down price action for a calendar year (I utilize a 20-year average) and does not indicate that the price action climbs upward every year forever. Coincidentally, I published a juxtaposition graphic literally hours before the Aug. 2 event. The last red arrow line on the right partially covered a downward blip on the seasonal that was due very soon. Despite any selling pressure since July, gold’s price action has continued to trend upward since the Jun. 26 low at $2,293 and the seasonal summer rally that gained an impressive $191 until the Jul. 17 ATH. The DMI-ADX is still positive, the price is somewhat extended beyond the 50 Exponential Moving Average (EMA), and buy Volume has outweighed any selling since early March. There may be some choppy consolidation before any new ATH attempt short of any major news event. There is no technical damage in the daily or weekly chart, and the price action remains bullish.”

The Financial Times article on Aug. 28 referred to gold’s bouts of strength this year as “cyclical” trend, but is more appropriate to define it as seasonality which was covered in my previous analysis. Gold printed a new ATH of $2,531.59 on Aug. 20 and settled at $2,502.32 into Friday’s close. The ATH occurred after breaching the Flag Tilt’s topside trendline and/or the Neckline of an Inverse Head & Shoulders continuation pattern. A subsequent Throwback tested support at the Symmetrical Triangle’s topside trendline that formed prior to the ATH, and has since incurred a consolidation with higher lows and ATH resistance that’s forming an Ascending Triangle. I have updated Fibonacci Extensions off of the new ATH with a couple near-term resistance levels to watch for when the price action rallies into additional blue-sky territory.

The DMI-ADX is indecisive but remains positive, support rests around the 50 EMA, and buy Volume is steady and strong since mid-August with one day of large selling that occurred in a Throwback following the ATH. There may be additional consolidation before a new high is reached and is dependent upon economic and geopolitical news cycles. There is no technical damage in the daily or weekly (has a bullish DMI-ADX) chart and the price action remains bullish.

Silver Spot daily chart as of Aug. 30, 2024 close…

 

Excerpt from the Aug. 11, 2024 (Twitter thread) daily chart analysis:

“Silver has not fared as well as gold since selling began around Jul. 11 due to recessionary signals in economic data released by the U.S. and China. Keep in mind that roughly 50% of silver demand is for industrial applications, and it usually mirrors any downside in industrial metals. An exception is when gold’s investment demand intermittently drags silver along for a rally or serious shortages occur that outweigh deficits in silver supply as premiums spike. The Half Staff Flag noted in June was breached on Jul. 3 at $30 in lockstep with gold’s summer rally that began on Jun. 26, but the rally was halted at $31.74 on Jul. 11 due to the conditions noted in the analysis above. After printing a high at $32.50 on May 20 and the subsequent summer rally blunted, the price action hit a low of $26.34 on Aug. 8 after taking out all support gained in the $29-$30 Bear Trap zone. That low is sitting just above substantial lateral support at $26 going back to Apr. 2023. The downside in mid-July has formed a bullish Descending Broadening Wedge overall since May, and another is nestled inside that encapsulates the price correction since July. The DMI-ADX has trended negatively since mid-July, buy Volume is sporadic, and the price action needs to consolidate with large buy Volumes to break back above the 50 EMA. The chart is neutral with substantial support at $26, and technical damage will be reversed if the 50 EMA is decisively retaken.”

Silver has rallied since printing a low above $26 support at $26.34 on Aug. 8, encountered resistance at $30.17 on Aug. 26, and closed at $28.42 on Friday. The price action appears to be forming a Half Staff Flag on the daily chart around the 50 EMA and above 2024’s 38.2% Fibonacci level. Resistance at $30 must be decisively retaken on large buy Volume for the Descending Broadening Wedge’s topside trendline to be challenged and retest the $32.50 high from May 20. The DMI-ADX is indecisive but remains positive and buy Volume is solid since mid-August with one day of large selling that mirrored gold’s Throwback from its ATH. The technical damage noted in the Aug. 11 analysis was repaired after the price surged back above the 50 EMA on Aug. 16. The chart has returned to a bullish stance but is reliant upon the Half Staff Flag manifesting a rally above $30 resistance.

David Hunter: $3k Gold Is Conservative, Silver to $75 – GoldCore, Aug. 22

 

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TraderStef on Twitter / Website: TraderStef.com