An Equity Bear Market Looming? Metals in Near-Term Trouble?
Normally, Gold and Silver are non-correlated to down-days in equities, such as the SPX. However, during times of an impending bear market, algo-bots seek out massive liquidity for epic margin call losses. This has nothing to do with Gold/Silver being safe-havens or not. This is everything to do with liquidity issues.
In the time of the bear market of 2008, Gold and Silver also tanked and if this is the beginning of a bear market in equities, Gold and Silver will tank once again. If this is the case, I believe metals may not tank quite as much as a decade some ago due to far lower rates.
Ultimately, until this market breaks above and closes at 1600+ it will likely be nothing more than fake-outs. In reality, I am watching the 1480-1520 level to act as the overall floor.
What can save Gold? Ironically if this is not a bear market we can see Gold/Silver start rising again. However, given the fact that the metals tanked with equities it seems very unlikely. What may also save the metals in the near-term would be a collective world-wide rate cut collaboration which I have little faith on at this point.
In my opinion you want to wait to see which level breaks first: 1550 and 1600. A break above 1600 and a close could indicate a reversal. A break below 1550 likely unlocks a 1480-1520 value buy-in.
While a lot of people likely got burned in this market, the good news is that many people will have a once in a life-time low entry point before the run to 2000+ begins.
- zSplit
In the time of the bear market of 2008, Gold and Silver also tanked and if this is the beginning of a bear market in equities, Gold and Silver will tank once again. If this is the case, I believe metals may not tank quite as much as a decade some ago due to far lower rates.
Ultimately, until this market breaks above and closes at 1600+ it will likely be nothing more than fake-outs. In reality, I am watching the 1480-1520 level to act as the overall floor.
What can save Gold? Ironically if this is not a bear market we can see Gold/Silver start rising again. However, given the fact that the metals tanked with equities it seems very unlikely. What may also save the metals in the near-term would be a collective world-wide rate cut collaboration which I have little faith on at this point.
In my opinion you want to wait to see which level breaks first: 1550 and 1600. A break above 1600 and a close could indicate a reversal. A break below 1550 likely unlocks a 1480-1520 value buy-in.
While a lot of people likely got burned in this market, the good news is that many people will have a once in a life-time low entry point before the run to 2000+ begins.
- zSplit
