Jordan Roy-Byrne, Founder and Editor of The Daily Gold, joins us to review the technical support and resistance levels he watching for gold and what his shorter and longer term outlook is for the gold mining stocks. He discusses the importance of $1750 on the weekly charts, and the key 40 month moving average for support in gold if there is a further corrective move in the months leading up to the Fed rate hiking cycle in the spring of 2022.
Jordan is less concerned with the contrasting patterns of higher lows and lower highs on the weekly or daily charts, and outlines why the larger cup & handle pattern playing out over the last decade is the primary super-bullish pattern investors should be focused on for the larger trend. Since the pattern took 9 years to form the cup, then the 17 months of consolidation to form the handle is still very constructive for gold longer term, as long as it doesn’t break below $1570, which is the 50% retracement of the move from the major low in 2015 to the major high in 2020.
We wrap up discussing the continued underperformance of the gold stocks relative to the fairly high levels in the metals over the course of this year, and Jordan offers some thoughts on how rising costs and compressing margins has played a role. While he doesn’t see much reason for the miners to outperform the metals in the short term, he does see the 4-7 month period after the Fed hikes rates in mid-2022 as being a period of time where they may significantly outperform the metals.