Gold hit the 61.8% Fibonacci retracement – just like it had done in 2011 and in tune with my previous analyses.
The history appears to have rhymed quite clearly this time.
Please note that in 2011 and 2012, we had more than one move to the 61.8% Fibonacci retracement before gold’s decline picked up pace. We just saw the second top close to this retracement and – what is just as important – an immediate invalidation of this move.
And where did silver move?
Silver almost touched its 50% retracement, being relatively weak compared to gold in terms of weeks, but strong on an immediate-term basis – the last 10-20 hours marked gains in silver that outpaced those of gold.
The current situation has just-like-in-2011 written all over it.
The trading and investment implications for the precious metals market are described in the full version of today’s analysis – the Gold Trading Alert – and in the following part, I’ll focus on another opportunity that you might want to take advantage of – the one in bitcoin. But before moving to that, let’s examine the situation in the USDX.
The USD Index’s pullback seems to be complete – based on the support level that was reached (the mid-2025 low) and given the sizes of previous post-bottom pullbacks.
There’s also a fundamental trigger for the turnaround.
Namely, nonfarm payrolls came in better than expected. Yes, the overall trend is poor, and the economy is not in great shape, but on a very short-term basis, it was a positive sign – perhaps that was all that the market needed to view the correction in the USD as a thing of the past.
Consequently, it seems to me that the corrective upswing that I thought was quite likely is over or about to be over. If I were waiting for another opportunity to hedge my silver positions (having missed the previous hedging opportunity above $100 that I had featured), this – today – would be my moment.
If I were considering opening a short position in mining stocks or adding to it – again, it would be my moment.
We already have those positions, so I’m not adjusting anything in any part of the capital within the Alerts.
With one exception.
I’m re-opening the short position in bitcoin.
If the USD Index bottomed and bitcoin failed to rally more during the USD’s decline – despite being so oversold on a short-term basis – it means that bitcoin is about to move even lower.
Given that it had already corrected somewhat, I think that it can now decline below my previous target and rebound from the mid-2024 lows – at about $53k. That’s my current target for it.
Thank you for reading today’s free analysis. For a full picture, the details, and ongoing premium support, I encourage you to subscribe to my Gold Trading Alerts today.
Thank you.
Przemyslaw K. Radomski, CFA
Founder
Golden Meadow®