Gold’s Secular High 2

Given gold’s recent price action, have we seen a secular peak for the metal? While I was not quite sure early in 2013, I don’t think there is any question in my mind today. The high seen in 2011 can be equated to the 1980 and 1947 highs, tops seen in secular commodity bull markets.

I wasn’t very happy with my precious metal analysis in February so I bought some long term data for gold and ran this analysis based on data back to the 1960s. The approximate 8 year peaks in gold are very distinct when viewed in the context of the 16 year FLD (blue line). The peaks seen since the 1980 high were notably marked by peaks in the 16 year FLD. These peaks also mirror the 8 and 16 year cycle lows if one were looking at a trough analysis for gold.

I won’t go out on a limb with a shorter term forecast for gold. However, I would say that bear market strategies are appropriate for the metal into the summer.




N.B. Posted April 15th but moved to blog area today. No change on long term outlook, however a 4 year cycle low is due for the metal this summer.

About SilentOne

I am a retired Chemical Engineer. I became a house dad back in 2000 and then devoted all my free time to the markets. After years of technical analysis study I decided upon Hurst cycles, which has been my primary method since 2007.

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2 thoughts on “Gold’s Secular High

    • SilentOne Post author

      Derek, I used the ICM setting (initial cyclic model per Hurst theory) here because gold cycles are slightly shorter than Hurst nominal cycle periods. And you are right that you cannot use an expert model in the peak to peak analysis mode for Sentient Trader. The peak analysis presented here is picture perfect IMO. The 16 year (blue line) FLD plots the path and pinpoints each high made in the gold bear from 1980 to 2001. The interesting thing is that an important high is due roughly in 2020, the next 8 year peak cycle.

      The next long opportunity is setting up shortly for a swing high in Q1 2014. Study the peak in the 16 year FLD (blue line) to see why.

      Hope that helps.