The Gold Market: Essential Guide for Investors
Introduction
On April 22, the gold market reached a new all-time high at 3,509.90.
Is this the end of the bull market which started in November 2022?
Let’s see what the Hurst cycle analysis tells us.
The gold market: monthly Cycle
On the monthly chart, the Gold market made an all-time high in April.
What is the degree of this cycle?
With a high degree of confidence, we can label this peak as an 18-month cycle peak.
The other options are a 54-month cycle, which is 4.5 years, or even potentially the 14-year cycle.
But for now, let’s dig into the weekly cycles.
The gold market :the 40 week cycle
The last significant 40-week cycle formed a low in February 2024. Due to the Hurst rule of synchronicity, this low was also the last 18-month cycle low.
After forming the 18-month cycle, the gold market formed its first 40-week cycle since the last 18-month low in November 2024.
At that stage of the cycle, the gold market was supposed to form its low and find support on its cycle line,
But there was so much bullishness in this gold market that the low formed well above its cycle line.
The next 40-week cycle is expected to form in the second week of September, and during this low formation, the gold market should cross below its cycle line and provide a downside target.
This low will also be the next 18-month cycle low.
See where the 18-month cycle peak occurs?
Here are the cycle lines and their potential targets for the next few weeks if the gold market crosses below them.
There is a high probability during the next decline that the gold market will form a low around its 18-month cycle line, or even lower, depending on the April 22 high cycle degree.
At the end of this video, I will go into more detail for the different scenarios.
For the past two years, the 40-week average length is 38 weeks, slightly shorter than the Hurst nominal model, which is 38.97 weeks, discovered 50 years ago by Hurst.
The current 40-week cycle peak occurred on April 22.
The blue trendline represents the 40-week trend line; any crossing below will confirm the April peak will be at least an 18-month cycle.
The 20 weeks cycle
April 7 marked the last 20-week cycle low at 2,970.40.
During the November 2024 20-week cycle low, the gold market found approximate support on its cycle line, even trading slightly below for a few weeks.
Technically, the November low was supposed to cross more clearly,
and should have provided a downside target,
but due to the great amount of bullishness in the gold market,
It was not surprising for the gold market to barely cross below its 20-week cycle line.
Another sign of extensive bullishness in the gold market:
during the last 20-week cycle low on April 7, it formed well above its cycle line.
At that stage of the market, the gold market should cross below its cycle line,
providing a downside target, then rebound toward its cycle line without crossing above it,
using it as resistance and resuming its downtrend to form its next 20-week low in September.
We can expect during the next low formation,
that the gold market will cross below its 20-week cycle line, to at least its 40-week cycle line.
If the gold market forms a low in September on its cycle line and rebounds,
Then, this will confirm it still has significant bullishness.
Here are the cycle lines for the next few weeks, and their potential targets if the gold market crosses below.
The green trend line is the 20-week cycle trend line; a crossing below will confirm the 3,509 high is at least a 40-week cycle peak.
Let’s look at the lower time frame to see if we have some trading signals.
The 80 day cycle
The last 80-day cycle low formed on April 7 with a low at 2,970.40.
Let’s see with the roadmap what we can expect for this 80-day cycle.
To analyze the 80-day cycle, I am going to use the 80-day roadmap.
As a reminder, to trade the 80-day cycle, we use the 20-day cycle line, and each time the market crosses the cycle line, this gives a trading signal.
In each cycle there are 4 trading signals, 2 on the upside and 2 on the downside.
The present 80-day cycle started on April 7.
As expected after the low formation, the gold market crossed above its cycle line and provided an upside target.
The crossing occurred at 3,093 for a potential upside target at 3,216.
On April 11, the gold market reached and exceeded its target, for a profit of 123 points or 3.97%.
After forming a new all-time high for the 20-day cycle,
the gold market crossed below its 20-day cycle line.
Technically, at the first 20-day cycle low after the last 80-day cycle, the market should form its low on its cycle line.
By crossing below its cycle line, this shows some weakness coming into the gold market.
After crossing below its cycle line at 3,321, this 20-day cycle low formed on May 1.
This 20-day cycle lasted 24 days, which is 6 days longer than the Hurst nominal model.
The target for this crossing is 3,133, then the market rebounded on its way to its 40-day cycle peak, which was on May 7, crossing back above its cycle line.
Personally, since the crossing occurred with a red candle,
I don’t validate the crossing, When this happens, I usually wait for confirmation the next day with a very bullish candle.
This didn’t happen; the next day we had a red candle, and the gold market traded back on its cycle line, so the 3,133 target is still valid.
After forming its 40-day peak, the gold market resumed its decline to form its 40-day cycle low on May 15 at 3,123, meeting and even exceeding its target by 10 points.
It then rallied, crossing above its cycle line at 3,306 on its way to its 80-day cycle peak. The target is 3,489.
The same day, the gold market made a high at 3,366.
On its way to its next 80-day cycle low on June 16, technically, the gold market should cross back below its cycle line, but if it crosses below before meeting its target, this will be a negative signal, and we can expect further decline.
The gold market :The 40 day cycle
The 3,123.30 low on May 15 is the last 40-day cycle.
The next one is expected to form on June 18.
After forming its May 15 low, the gold market crossed above its cycle line. Since the crossing point occurred with a red candle, for now I won’t consider this signal valid.
I need confirmation with a green candle on Monday.
If that happens, then the upside target will be 3,507; otherwise, the 2,982 downside target will be the next goal.
But since there is some bearishness coming into the gold market, there is a possibility the market will cross back below its cycle line on Monday, and 2,982 will be the number to keep in mind.
The gold market:The 20 day cycle
Since we are using the 20 day cycle line to analyze the 80 day cycle, the overall analysis is the same as the 80, we can expect the next 20 day cycle crossing his cycle line, providing a downside target to June 3, then the gold market should rally toward his cycle line, using as resistance and resume his decline to June 16, for the last 20 days cycle of this last 80 day cycle.
In conclusion,
We can expect the rally to continue, reaching at least the previous all-time high. There is a very high probability the S&P 500 will achieve a new all-time high, fulfilling its various targets. The four Target to monitor are 6,183, 6,237, 6,319, and 6,859
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