A severely bearish November

With US capital markets coming to decide a Trump presidency might actually be a good thing, it was a severely bearish November for the precious metals. Gold and Silver saw net monthly declines of -$99.20 (7.8%) @ $1173.90, and -$1.31 (7.4%) @ $16.48 respectively. Near/mid outlook is bearish, the only issue is whether the Dec'2015 lows are broken under in early 2017.


Gold, monthly2

Silver, monthly2

Summary

A very bearish month indeed...

key issues...

-Higher USD (capital inflows, amid higher rate expectations)... naturally pressuring gold/silver
-Increased market confidence, as the uncertainty of the election has passed, resulting in Gold/Silver losing more of their inherent fear bid.
-Underlying econ-data points in November has been (arguably) rather good.

Near term outlook offers further significant weakness in December. The bigger issue is whether the Dec'2015 lows will be taken out. Its a very difficult issue to guess, but what can be said is that there is ZERO sign of a floor/turn, from the down wave that began in July.
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Implications for the miners

As ever, weakening metals have very bearish implications for the related mining stocks, even as the broader equity market is powering to new historic highs.

A third week lower

It was a third consecutive bearish week for the precious metals of Gold and Silver, with net weekly declines of -2.2% and 0.6% respectively. Gold has been particularly hit, as its inherent safety/fear bid continues to fade, as the broader capital markets are increasingly pleased.


GLD, weekly

SLV, weekly

Summary

Suffice to add... November is set for a very bearish close. The monthly candle will be of the bearish engulfing type, and that suggests Dec' will see new cycle lows.

The only issue now is whether the Dec'2015 lows will hold.

The one indirect aspect that suggests Gold and Sillver will hold the Dec'2015 lows..... Copper.

A second week lower

It was a second consecutive bearish week for the precious metals of Gold and Silver, with net weekly declines of -1.6% and -4.5% respectively. Near term outlook offers further weakness to price gap zones. With the USD super strong, mid term outlook remains bearish.


GLD, weekly

SLV, weekly

Summary

With the USD net higher this week by around 2.0% in the DXY 101s, it was not exactly a surprise to see Gold and Silver broadly lower.

Things turn VERY bearish if...  GLD <112 and SLV <$14

If either or both are seen, it would suggest a FULL retrace to the Dec'2015 lows. Further, it would re-open the original target of Gold $900/875, with Silver around $10.

... and if that happened, it'd bode extremely bearish for the related mining stocks, even if the main equity market continued into the sp'2300s and beyond.

Post election collapse

With the election out of the way, equities soared, volatility rapidly cooled, and perhaps most notably.. the precious metals collapsed. Gold and Silver saw severe net weekly declines of -5.9% and -5.8% respectively. Near term outlook offers a bounce, but if core support is not held... the Dec'2015 lows will be challenged in 2017.


GLD, weekly

SLV, weekly

Summary

Last week saw gold and silver negate price structure of a very clear flag.

With the election now passed, the metals have seen a complete reversal.

The USD is not helping, having seen the DXY 99s this week
There was news of a massive 'big money' seller of Gold futures, totalling around $10bn.

The remaining inherent 'fear bid/safety aspect of Gold/Silver has now been immensely reduced.
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Best guess? The outlook remains mid term bearish. If GLD <112 and SLV <14.50.. the Dec' 2015 lows will be taken out next year.

If that occurs, the related mining stocks will be utterly obliterated.

Against that... price structure is offering a multi-month bull flag... but that would only be confirmed if the miners rally around 20% from current levels.. >GDX $26.

Metals rising on market fear

The precious metals of Gold and Silver saw a third consecutive week of gains, settling net higher by 2.4% and 3.6% respectively. Recent cooling in the USD from the DXY 99s to the 97s is no doubt a primary reason for the continued recovery.


GLD, weekly

SLV, weekly

Summary

Perhaps the most notable aspect this week, was that with some significant gains, price structure of a bear flag has been completely negated

So.. where now?

Gold and silver rallied from multi-year lows in Dec'2015 to July/August 2016, and have seen around three months of broad cooling.

Not only is there some underlying upward cyclical pressure, but we're clearly seeing a slight fear bid for Gold/Silver.. as the US election nears.

Seen on the giant monthly charts, some could justifiably argue that the past few months are merely a large bull flag - as also reflected in many of the related mining stocks.

To have clarity of that, Gold/Silver.. and the miners, need to break above the Sept' highs.