ABX update and fine tuning. Probable more than half of the readers of this website (about 4000 per year) are intensely interested in gold and gold stocks. The reason is simple. Economic theory has percolated to the-man-in-the-street level and now EVERYBODY knows that printing money downgrades a currency and ergo causes inflation. Unfortunately, as is so often the case, theory and reality part company as soon as the rubber hits the road. Certainly the past two years has not been fun for the “hedgers” of inflation. But here is an opportunity, perhaps only for the short-term but still an opportunity worth considering.
ABX is down by about 1/2. It is the prima donna among the big producers with the likes of G, Goldcorp. They have virtually identical charts (see below). In any event it looks like a very real buying opportunity presents itself at about these levels 26<ABX<29 (see previous blogs). Counting , or labelling charts is an art that only the fellows in Gainsville are able to do with perfection. We just try our best. Having sliced this one in several ways , we are convinced that a 5th wave of something is coming to an end. That implies a rebound usually back to the 4th wave, as shown by the arrows above using different degrees for the 4th waves. That is $7 to $14 of pure potential assuming a $28 entry point.
This one is impossible to label. There is a lot of overlap. Even so the drop is pretty well identical, from $56 to around $30 or so. Here too the last leg needs one more new low to complete itself.