David Fuller's view Precious metal surged up out of their trading ranges in mid-August and rallied over four consecutive weeks before running into psychological and lateral resistance near $1800 for gold, $35 for silver, $1700 for platinum and $700 for palladium.

My hypothesis during the approximately mid-May to mid-August period was that gold had moved from its earlier distribution phase back into an accumulation phase (see earlier comments on 21 Sep, 3 Sep and 23 Aug, currently requiring subscription registration). This would be consistent with gold's other medium-term corrective phases following upward accelerations, which lasted about 18 months before the overall upward trend resumed, as you can see on this 10-year semi-log chart.


If that cyclical process is occurring once again, as I think it is within gold's (daily & stochastics) secular bull market, then we have probably seen most if not all of the correction due at this time. If so, silver (daily & stochastics), platinum (daily & stochastics) and palladium (daily & stochastics), should follow gold's lead, more or less.

At the end of yesterday's opening item on equities, I mentioned that we were seeing some climactic selling in precious metals:

This could also be true of precious metals where short-term indicators have moved from overbought to somewhat oversold and there has been some climactic selling activity today.

Closes beneath yesterday's intraday lows are now required to indicate some additional downside risk for precious metals before they resume their recoveries.