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With a 90% of probability, this newly started uptrend by the Gold and Silver Miners is going to represent just the next correction cycle of the overriding bear market in the greater picture – the monthly time frame, but it may thoroughly last 7 to 8 months, even 1 year (12-13 month candles).
This issue is mainly dedicated to the purpose to work out the 2 most important and thereby likely attainable uptargets of this newly started countertrend in monthly time frame according to the factors time and price, using the example of the reference ETF GDXJ (VanEck Vectors Junior Gold Miners).
At the beginning of October 2018 (free GUNNER24 Forecasts, issue 10/07/2018), we realized with the help of the monthly bear market count that the GDXJ – then trading at 27.62$ – could print its final low of the year within 3 to 7 trading weeks cause the Blue Arc resistance in the most defining valid monthly GUNNER24 Up Setup radiates confirmed strong bearish pressure until possibly November 2018:
The overriding GDXJ countertrend - as the entire 8 Candle GUNNER24 Up Setup - starts at # 1 // 16.87 // 2016 Bear Market Low - and was in terms of its count resp. in terms of time by October 2018 candle at 34th month.
Thus, this market was predestined to deliver a major countertrend low or a next major turn in the near future or in further course of October, even perhaps in course of November 2018 = # 35 of trend, whereby 35-1 is possible Big Turn Number 34.
Most important downside target for the possible final low of 2018 was the above highlighted 2016 Support Angle at about 23.60$, 23.80$, GDXJ most important rising yearly countertrend support below the 27.62$.
Please look one last time up.
You will recognize that the scored high of # 31-July 2018 was slowed down due to existing Blue Arc resistance. At top of # 32-August 2018 the Blue Arc was 100% accurately hit from below, followed by next monthly sell candle which was finally cemented at # 32-Aug18 close, the lowest monthly countertrend close since at # 8-spike top made year 2016 Countertrend High.
Cause Blue Arc acted as strong braking, falling month high resistance in the second half of 2018, the very first SIGNIFICANT month close above that arc resistance would signal the first important buy signal for the Mining Stocks since 2016.
At the end of the December, this was achieved together with the fact that the September 2018 Low (month # 33 of the countertrend) is the final low of the last year.
Below you see the updated monthly 8 Candle GUNNER24 Up Setup which depicts the GDXJ course since its important year 2016 Bear Market Low.
==> Ruling year 2018 Blue Arc resistance finally phased out at 26.04$ November Low. Then it cut the time axis. This time event or final confirmation that a new monthly uptrend was triggered at September 2018 Low is highlighted by the fat orange-dashed vertical.
The SIGNIFICANT final December - also year 2018 - close above the Blue Arc is a "stronger" GUNNER24 Buy Signal which activated the imminent & accurate backtest of in course of 2018 finally to the downside broken 1*2 Resistance Angle.
Backtest of 1*2 Resistance Angle is NEAREST activated monthly GUNNER24 Uptarget = first important 2019 uptarget!
1*2 Resistance Angle is activated very important GDXJ uptarget for 2019! NEAREST freshly activated GUNNER24 Uptarget on yearly base!!...
... and usually should be tested at 36.50$ up to a perhaps 37$ at latest until the end of March 2019.
Watch, there is a well-confirmed important horizontal which this countertrend since 2016, but the market also respected before since 2013 on month high/low/opening and on closing base.
A 6-year horizontal magnet sitting at 36.45$-36.50$. We call this a "Pivot" or "Equilibrium" in the technical chart analysis.
That 36.45$-36.50$ pivot intersects the 1*2 Resistance Angle for the candle of March 2019, thus forming very attractive future upmagnet resistance according price and time.
==> Obvious & imminent 2019 upmagnet/uptarget at 36.50$/March 2019! Then and there the final high of 2019 could be printed - IF this monthly upcycle likes to run for 8 Fib number months!
IF the newly started Miners upcycle wishes to run for at least 1 year also lower line of 1st double arc uptarget usually will be tested in further course of 2019. Suppose, the lower line of 1st double arc could be tested at 43$ surroundings in that case.
==> Additionally the first test of lower line of 1st double arc in - sideways - countertrend direction became activated monthly GUNNER24 Upwards Target by the fired December 2018 Buy Signal above the Blue Arc!
But the test of the lower line of 1st in course of 2019 at 43$ surroundings only should come true with a reached decisive monthly close above the 1*2 Resistance Angle until end of June/end of July, maybe.
Above is the GUNNER24 Main Setup of the entire countertrend on weekly base.
A next "classic" 8 Fib number Candle up starting at # 1 // 16.87$ // 2016 Bear Market Low.
2016 Countertrend High was textbook to the T work off of lower line of 3rd double arc natural bull market uptarget. Thus, the lower line of 3rd became most strongest important future resistance for the GDXJ. And guess what did happen after first test or first - negative - backtest of lower line of falling 3rd double arc main resistance arc...?
... it went down the drain. Or in plain words, the 2018 downtrend cycle started at THE VERY FIRST - negative - backtest of lower line of 3rd double arc.
==> by that bearish first test the steeper getting downwards oriented 3rd double arc became confirmed falling yearly resistance arc, a prior very strong resistance, cause it triggered a hard and fast downwave or a so called sell-off cycle! Which turns out in retrospect as a final washout.
The 2018 sell-off/washout cycle finally bottomed at September 2018 Low and influenced by downwards pressing UPPER Line of 3rd resistance the market bottomed finally into 2018 Double Low pattern at November 2018 Low.
Towards end of November the upper line of 3rd resistance, the very last!! strong braking yearly resistance out of very important year 2016 Countertrend High, was first finally overcome on weekly closing base and afterwards successfully tested back and this backtest of 2016 Countertrend Arc Resistance ignited the really first strong stage of the weekly uptrend/upcycle which began at final 2018 Low.
==> The final overcoming of the 3rd double arc on weekly closing base activated the test resp. the work off of the lower line of 4th, next higher double arc, in (upwards-) trend direction.
==> The final and decisive overcoming of the 3rd double arc on weekly closing base additionally activated the IMMINENT backtest resp. the work off of the 2016 1*2 Resistance Angle!
Watch that the 2016 1*2 Resistance Angle was important rising support for 2018 and became rising yearly angle resistance once finally broken to the downside at the beginning of the 2018 sell-off/washout cycle.
To be more precise: The downside break of the 1*2 Angle triggered the 2018 washout!
Now the backtest of the 2016 1*2 Resistance Angle at 36.50$ to 37$ until March-April seems very obvious cause this is identifiable MAJOR combined weekly and monthly upmagnet resistance = MAJOR Resistance upmagnet, or rising important angle resistance for entire 2019!
According price and time this weekly uptrend was able to overcome dark-green dotted 29$ first square line by some weekly closings. Thus 29$ first square line usually should have morphed to actual nearest strongest weekly support.
Maybe the 29$ horizontal now even has morphed to strong supporting rail on yearly base. We will see and we will have to wait for a possible confirmation..., but quite sure the 29$ seems to be an obvious strong support to try to open a long position for the upcoming 2016 1*2 Resistance Angle backtest of 36.50$ to 37$ // March!?! 2019 upmagnet.
To conclude todays important analysis which we are allowed to use for the possible course of the entire Precious Metal Sector, please observe that the activated lower line of 4th double arc uptarget takes course at 39$-38$ for May-June 2019 time frame.
Then and there we are able to identify the next higher MAJOR combined upmagnet resistance for GDXJ, because activated weekly 2016 1*2 Resistance Angle uptarget and the activated weekly uptarget of lower line of 4th double arc unite there and then.
==> Consequently, also this upmagnet at 39$-38$ // May-June 2019 - could be the trigger to deliver the final GDXJ highs of entire 2019.
Be prepared!
Eduard Altmann
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