Truncated Bottoms - Market Analysis for Jul 16th, 2026

I would probably state that truncated bottoms in EW structures are not reliable in the same way that I view leading diagonals as being unreliable. But, as of now, there is some potential that this could be seen in the metals complex. And, yes, I have seen this before in metals.

But, if you have been reading what I have been saying of late, then you know my preference is to be layering into positions down here. I am personally still leaving dry powder for lower lows, as they complete their patterns more often than not.

In gold and silver, we are seeing the potential for those truncated bottoms. Yet, I have not seen any clear 5-wave rallies begin off those bottoming structures. For this reason, I have been waiting for a better entry. In fact, I am not really personally focusing on gold or silver at the moment due to the potential that the next rally can likely be a larger degree b-wave, and potentially can underperform the mining stocks.

And, while I am focusing more so on the mining stocks, there are still quite a number that have not completed their patterns. Moreover, I cannot say that I have a clearly completed pattern in GDX either. So, I must still suggest patience if you are wanting to get better entries in these across the board.

Again, I want to reiterate that the best approach right now – as we are likely trying to feel for a bottom in the complex – is to layer into individual mining stocks. Yes, you may still see more red in those stocks (and quite a number are still positioned to go lower to complete their respective 5^th waves in the c-wave), but I think the risk/reward relationship right now is quite favorable to be building positions as these structures still look as though they are approaching the completion of the correction which began in January of this year.