Gold Weekly Analysis
Who would have thought gold could drop 6% in just one week? We’ve been alerting and pounding the table for weeks, and now the metal faces a critical crossroads. Is this the start of a deeper correction or the setup for another explosive rally — one not seen since the Nixon Shock era? In this weekly gold analysis, we break down XAUUSD, gold futures, and GLD using multi-timeframe candlestick patterns, Elliott Wave structure, and momentum indicators (MACD, EMA, RSI) to uncover what the latest signals reveal about gold’s next major move.
CANDLES
GLD
GLD formed a strong Dark Cloud Cover. A Bearish Engulfing would normally be the cleaner bearish signal, but in this context the Dark Cloud Cover is actually trickier — it leaves more room for a fake bounce. We might not see immediate follow-through down; GLD could spend 1–2 weeks bouncing or consolidating, convincing most traders it’s setting up for another leg higher, before launching the next bearish offensive.
Gold
On the daily frame, gold lost the 8 EMA support and, as follow-through, it formed a Dark Cloud Cover on the weekly, similar to GLD. The monthly candle is still bullish for now, but we have 5 days left, and I’m not convinced it will hold. Even if it does, the monthly RSI is now the second highest since the Nixon Shock. The only higher reading — in the 1973 — was followed by a ~50% drawdown over the next two years. Does that feel like “nothing to worry about”? The weekly is not fully confirmed yet, but the odds over the next few weeks are not friendly.
I’ve already covered the statistical implications of September’s close in the monthly/quarterly report.
Overall, gold is bearish short term, neutral-bearish mid term, and still bullish long term. This may change significantly on October 31.
GDX Miners
GDX is looking seriously bearish after the weekly close. We now have a strongly bearish weekly combo backed by solid technical support. The daily 8/20 EMA bearish cross and multiple momentum signals are now aligned with the bears. Be prepared for a high risk that GDX flips the monthly frame strongly bearish on October 31.
As outlined in the August 21 Long-Term Outlook, gold is likely building a significant top—one that could take months to complete. That hypothesis stands.
Gold – Long Term Outlook – August 21
As discussed previously, “a particular concern is the continued no-break advance in the monthly RSI, which has not been this elevated since 1980—45 years ago. Apparently, this implies a new reality in which gold is never corrected again. However, statistical analysis suggests a potential loss of about 35% if gold follows the average historical path after such an RSI stretch. In May, gold formed a bearish candle—June will show whether that signal is confirmed. Gold is now in a zugzwang position: any move on the monthly frame will only worsen either the technical conditions or the candle structure.”
Elliott Wave: GDX
GDX formed a clean impulse down and is likely forming a bearish flag for wave (ii) or (b).
For gold, I have three counts. The red and blue counts are very similar to the structure in GDX. The purple count is a possible triangle. A move above $4,154.79 will invalidate the triangle. From an Elliott Wave perspective, I would actually prefer the triangle — it would almost certainly prevent the development of an impulse of a higher degree, although the wave (c) after the triangle would likely be spectacularly aggressive.
Summary:
The numerous alerts are materializing into strong bearish moves for gold and GDX. Downside momentum is building with avalanche speed. Silver is aligned as well, making the entire precious metals sector increasingly unattractive for mid- and long-term investors. The risk of closing October with strong bearish signals is now highly elevated, and the current wave structures are opening the door to further downside — potentially very significant, at a scale we haven’t seen this century.
Happy Trading!
