This is something I discussed in the live video this morning. Please take a look at the attached daily chart of the GLD, and you will see how the MACD is back in the topping region. And, if you remember the last time it did this, everyone was also very bullish and thinking we will simply continue higher. Yet, my expectation was for a pullback to be seen first. And, that is what we saw.
Again, we are at the MACD resistance. And, I am now looking for a smaller degree 2nd wave. Therefore, while I am expecting a pullback, I do not think it will be as large a pullback as the larger degree wave , of course, unless the market takes the alternate path.
This brings me to a question I always ask of myself: How will I know if I am wrong?
Well, this is where I have outlined the pivot on the gold chart. And, since gold is closer to its pivot than both silver and GDX, it will likely provide us with the first indication that we have begun the “melt-up” phase in the heart of the 3rd wave higher. But, until we actually see a [i][ii] break out set up, I am still going to expect more of a pullback in the coming week or two.
With regard to silver, it has been quite bullish of late, with pullbacks being very shallow. But, again, we are still quite a ways below the pivot, so I am going to maintain further patience before I see a higher probability signal that we are in the melt-up phase. I really do not like getting too aggressively long until the market makes it VERY clear we are in a 3rd wave. And, keep in mind that the wave 3 box overhead on the 144-minute silver chart is only the wave 3 of iii of , and that is a conservative target.
The same applies to GDX. And, on the daily chart, we have at least 50% higher to go beyond the top of the pivot outlined on that chart.
So, not much has really changed. I am still going to try to maintain a bit more patience because I still think we can get more of a pullback before we are ripe to finally break out in the “melt-up” phase I am expecting later this year. Therefore, for now, I only have initial entries in aggressively long positions with an expectation to be able to add lower. But, if we break out sooner rather than later, then I know my signal points at which I will have my final adds.