Silver to proceed down to 28 - Stop above 50% of Friday's Move
Updated
06.22.24
The size and structure of the waves in the decline so far lead me to believe that we can NOT defeat the large blue 5th wave (that lead us to the highs) in this set of waves down... that we will need a break of structure to the upside (or a new high) before that will be possible.
But since we have no break of structure back to the upside, it does look like the sequence of waves should continue lower. Yellow A seems to be a leading diagonal that held below the 50% retracement and this is additional support for the thesis.
Because Yellow Circled A is a leading diagonal (a motive structure) it is very likely that the following C wave will be an impulse.
By pausing at the 62% of the B up, I think that the market has shown us this will be wave 1 of Yellow Circled lower, and we can expect a mild retrace before a 3rd wave lower that should break through the 62% of the entire wave up, before pausing and retracing a 4th wave back to the same 62% - and then making a final low in a 5th wave. These targets are using my new Rule 62.
50% of the blue 5th wave makes perfect sense for C to complete there, and if our pink second wave does indeed hold a 38.2% retracement, then the 138% for 3 and 162% for 5 line up perfectly... additionally C as 78.6% of A is the most common target I have seen for abc's where a is a leading diagonal. Last but not least, because I don't think we will defeat the blue 5th wave in this move, a hold of it's 78.6% will also make perfect sense.
The size and structure of the waves in the decline so far lead me to believe that we can NOT defeat the large blue 5th wave (that lead us to the highs) in this set of waves down... that we will need a break of structure to the upside (or a new high) before that will be possible.
But since we have no break of structure back to the upside, it does look like the sequence of waves should continue lower. Yellow A seems to be a leading diagonal that held below the 50% retracement and this is additional support for the thesis.
Because Yellow Circled A is a leading diagonal (a motive structure) it is very likely that the following C wave will be an impulse.
By pausing at the 62% of the B up, I think that the market has shown us this will be wave 1 of Yellow Circled lower, and we can expect a mild retrace before a 3rd wave lower that should break through the 62% of the entire wave up, before pausing and retracing a 4th wave back to the same 62% - and then making a final low in a 5th wave. These targets are using my new Rule 62.
50% of the blue 5th wave makes perfect sense for C to complete there, and if our pink second wave does indeed hold a 38.2% retracement, then the 138% for 3 and 162% for 5 line up perfectly... additionally C as 78.6% of A is the most common target I have seen for abc's where a is a leading diagonal. Last but not least, because I don't think we will defeat the blue 5th wave in this move, a hold of it's 78.6% will also make perfect sense.
Note
This is one of the few times that watching a spread can be super beneficial. This is Gold divided by Silver. When this chart goes up, Gold is gaining ground relatively - when it goes down then Silver's price is gaining relatively.Silver is also on the chart in Teal. Remarkably, you can see the direct inverse correlation between Silver's price and this spread... when the spread goes up, silver (and gold coincidentally) are USUALLY going down... Silver just goes down more so the spread rallies.
The spread recently completed an impulse to the downside (5 waves) and dramatically reversed course in a 1st or A wave up. It has been followed by an ABC correction and is now poised to continue higher fast in 3 or C... which should bring the price of silver down relatively.
A solid piece of supporting evidence IMO.
Note
I have been watching DXY more regularly than DX futures... whoops. I'd been counting this rally rather benignly as a WXY... but I forgot that in the futures we had a ridiculously strong reversal on June 7th with good economic data - basically we won't be lowering rates was the synopsis... and it's been up since and it's been dramatic at moments... enough so that I think this will continue until it reaches and/or pokes recent highs before a reevaluation. Dollar up is generally bearish for metals.
Note
If the stars align for this spread to continue higher in its third wave, I am fairly certain that will be the flush in both Gold and Silver - but silver more (as the price of gold goes up faster relatively).Zoomed in you can see we had an extreme 5th wave diagonal... if it holds 50% retracement it is a very bullish structure and you can see it would extend as 1 of the larger blue 3 that will take us much higher.
Trade closed manually
In profit substantially - but if inflation comes in low tomorrow and the Fed plans to cut rates the dollar is probably going to head lower...Gold seems to potentially be headed higher out of a triangle 4th wave possibly as well...
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