From the February 2019 Breakout, we are able to clearly see the spectacular rally within the Customized Index chart aligned with an enormous rally in GoldCOVID-19 backside. Might or not it’s that excessive price transfer one way or the other represented a key future goal for Gold
There is very little corresponding data to compare to – so we’ll have to continue to try to dig deeper for any confirmation of this unique setup. Yet, we can’t underestimate the DUAL PEAK setup on the Custom Index chart and the fact that the second peak, August 2020, also aligned perfectly with the current peak price in GoldGoldGold
One thing we can say with a moderate degree of certainty is that the Custom Valuations Index chart appears to lead the precious metals in many instances and it appears to perfectly align in other instances. Our research suggests the US and global markets have recently entered a Depreciation Cycle phase which may last many years. The Custom Valuations Index chart is suggesting that the US, global and precious metals sectors are weakening and attempting to find/set up a new momentum/base.
This would suggest that capital will move away from precious metals as well as major market sectors and attempt to find opportunities in undervalued or other hot sectors. Eventually, once the new momentum base/bottom is firmly established in Gold
The key take-away from this research is that sector rotations related to precious metals, major global markets and potential early warning signs of strength or weakness may be attainable by focusing on how the Custom Valuations Index trends in comparison to Gold
This is also an important reason to focus your attention on finding the best and hottest sectors for new trade opportunities. When broad components of the market enter bearish trends, like the Custom Valuations Index is suggesting for precious metals, it is best to have a proven system for identifying the best sector trends and trade opportunities. While one sector may stall, others are rallying. Long term success is found by focus your trading capital on the strongest opportunities while avoiding weaker trends.
2021 is going to be full of these types of trends and setups. Quite literally, hundreds of these setups and trades will be generated over the next 3 to 6 months using my (BA)N technique. You possibly can learn to discover and commerce the most well liked sectors proper now in my free one-hour (BA)N tutorial.
For a take a look at all of at this time’s financial occasions, try our financial calendar.
Get pleasure from your weekend!
Chief Market Strategist