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Precious Metals Projections

Gold Price Today - Projections November 2023

Craig and Chris on Precious Metals Projections Banner

In today’s episode, listen to Craig Hemke and Chris Vermeulen discussing the dynamic landscape of the precious metals market, as well as:

  1. What are the four main asset stages discussed in the podcast, and how do they impact investment profitability?
  2. Can you provide examples of recent asset cycles, and explain how recognizing these cycles informs investment strategies?
  3. How does Chris assess the current state and future outlook of the gold market, considering external factors like the stock market?

Watch the full video below: 

 

Craig: Greetings, again, from Sprott Money News at sprottmoney.com. It is November the 2nd. Yep, we are officially starting a new month here at Sprott Money and it is the month of November and it is time for your Monthly Precious Metals Projections. I'm your host, Craig Hemke, and joining us as he always does in the early part of the month is Chris Vermeulen of the Technical Traders. Chris, good to see you.

Chris: Good to see you, Craig, and almost Merry Christmas. It's snowy where I am right now. You wake up to white snow, it is quite the vibe change.

Craig: Is it ever? Oh my gosh. And I guess that the calendar is undeniable. It is definitely, we're moving toward the holiday season. And as Chris points out, the Sprott Money Holiday Sale is pending. The Holiday Gift Guide, it's all there. You can look at it right now on the Sprott Money website as Chris is scrolling through. The sale begins in the middle of the month. So you want to keep an eye on Sprott Money for that sale. And, again, if you're out there shopping for your kids, your grandkids, you know, anyone that you know, why give them something that's Fiat-based for crying out loud? When you can give them sound money or you can begin an education in sound money by providing some silver rounds, maybe something, a fractional ounce of gold, whatever. Great gift idea, something different and unusual. And hey, sound money, Chris, is the gift that keeps on giving the whole year, Clark. So hey, check it out again. The Gift Guide is on there now. The sale actually begins in the middle of November.

We'll be talking about all month and all of the content that appears here from Sprott Money. So make sure you subscribe or like so you don't miss any of that content as it pops up and you don't forget to check out the Sprott Money sale. All right, Chris, what a month we just had for crying out loud. Wow. After the Fed meeting in September, gold went on a tear to the downside. Seemed like it was just washing out anybody that was left that was still optimistic. What, nine days out of 10, it went down. Then we finished the month with gold going up like 10 days out of 12 and at almost a 10% rally on geopolitical fears that really the notion too, that the Fed is very likely done with their rate height cycle. It's been a crazy month and now we're poised to take on the end of the year. You don't just focus on the precious metals in what you do though. So, why don't we take some time here, and you kind of walk through your process a little bit, what's on your mind, and what you see here for the final couple of months of the year?

Chris: Yeah, I mean, there's kind of a lot to unpack there. There's a lot of things going on in the markets. And, as you know, I tend to show, I like to show this graph that we always kind of talk about is understanding the stages that all assets go through. There's kind of four stages. As we talk about, there's a stage 1 and stage 3, which are dangerous times, are difficult to make money because they're choppy. Stage 2, which is our bull markets, and stage 4, which is our bear markets and financial resets, are big trends. They are highly profitable. So I kind of put together some interesting charts here to touch on just so people can see some of these cycles that we've actually gone through recently in some asset classes. So, for example, this is natural gas. If we were to just take a look at the natural gas stage that we've gone through in the past two years post-COVID, we've gone through this whole phase to the upside. It went into a stage 3, a high volatility chop, and then eventually it broke down. And it's gone through that full cycle up to the upside. And these patterns happen over and over again.

A lot of people get caught up on the daily noise and they totally lose sight of where we are in these major cycles. But when you step back and look at that kind of 35,000-foot view of different asset classes, you can get an idea of where we are. You can mentally be prepared for the stage that we're in because each stage requires a bit different strategy. If something's not in a favorable stage to even trade, you gotta go find a different commodity or you gotta find a different asset class. So I just wanted to kind of go through and just look at some of these. Like, you know, natural gas went through this massive cycle. If we take a look at another one, this one, which a lot of people got involved in, this is the ARK ETF. If we take a look at that, I mean, we saw it just explode up and your fork phase. It had a stage 3 top and then it broke down. And I still think the ARK ETF is gonna be down in the low teens by the time things are all said and done several months from now. But I mean, this is the emotional roller coaster that people went through during the kind of post-COVID blow-off phase.

Everybody thought they were, you know, superheroes. Everything was trading up into the right. And eventually, you know, things broke down and there's a lot of people down 50%, 80%, 90% on a lot of these stocks. And, you know, this whole phase has kind of worked itself out. Bitcoin has gone through it. I didn't pull one up for Bitcoin at the moment, but this is another one that we've recently gone through. Another one to pull up here real quick is also the clean energy. I mean, clean energy space had this huge move and it is back down and it's kind of dead money. And this was like one of the darlings of the, you know, COVID. I mean, it was up something like 300%, 400% in a very short period of time. And now you're right back down to most likely, you know, you're down, giving back all of those gains. So that kind of leads me to the two most interesting things. So those are cycles that have been completed.

On the flip side, if we were to take a look at gold, now, let me just zoom in here on the gold a little bit. So gold is actually in the startup phase. So the other ones have completed their whole stages and are gonna be dead money, I think, for quite some time. Where gold is still in this process where we're gonna go into this massive commodity, this big rally phase. And I do think gold is still gonna be under a little bit of pressure. You and I talk about this every month. I still think if the stock market, we go into a recession, the stock market has a bear market. It's naturally gonna pull gold down. It's what happened in 2000s. It's what happened in 2008, 2009. Gold will get pulled back a bit, but then I think we're gonna go off and see this huge move where gold could go 27, 3500. And, eventually, it'll have some blow-off phase and then it'll fizzle out for a long time. And gold has done this pattern over and over again.

In fact, if we go and we pull up the chart of gold, I might actually flip to the monthly chart just to make the chart a little cleaner here. But if we go back and take a look at gold from just this phase here, this is post-COVID, not COVID, the 2008 financial crisis, gold took off, had a blow-off phase, everybody talked about it, everybody piled in, it topped out, it corrected, and it's been flatlining. And so obviously this leads us to where we are now, which is kind of the start of the whole next cycle where it is just starting to ramp up. I think we could still see it consolidate a little bit, but then we're gonna be off to the moon. And if we even go back even further, if my chart will go back, you can see the last time we went into this phase. We have this massive blow-off phase, high volatility chopping, it breaks down, it's dead money for decades. So this pattern happens over and over on all timeframes. Could be the one-minute chart, could be the monthly or quarterly chart. But to me, again, just to bring gold up, because, obviously, gold is a very exciting play here, if I can just find where I put that gold chart. Let me just see if I can pull that up here.

Craig: It is remarkable, Chris. I mean, just chart after chart that you find. That looks like that initial one that you showed. That's really crazy.

Chris: Well, for some reason, my chart just flipped. I don't know where the gold one went. But, long story short is we're looking for gold. I can draw it right back on here. We're looking for gold to shoot up to this... I think, eventually, we're going to see it pull back. I wouldn't... This to me would be like the last real good buying opportunity. If the stock market has a correction, gold has a correction. And then eventually we are going to see, I think, gold ramp up into this 35. It's going to go way up there, 3500 or so before it peaks out for that next major move. So that's what's really exciting when you look forward where we are in this in the super cycle stage, where we are right here, to me, feels a lot like kind of where we are right back over here. You could even argue right over here because we're up trading near these highs. I know this chart is super squished here, but, you know, right here is kind of like where we're potentially trading right here.

We might still have several more months of sideways lower pricing, but then we're going to start...I think it's going to be a five to 10-year super cycle in gold. We're going to see commodities reevaluate. We're going to see currencies. We're going to see all kinds of different stuff. And, hopefully, this doesn't mean there's a huge bigger wars, deadlier wars coming. But, I mean, it's going to be interesting. So just on the last one, just because I have one more chart here, which is the the SP 500. So this is where I think we stand in the SP 500 right now. We've got this huge euphoric final blow-off phase. Literally everybody got into the stock market in 2020 and early 2021. That is like the signature of like, okay, if everybody is now trading stocks who was... They used to bet on football now they're trading stocks, you know the masses have got sucked into the market. And now, we're in this complacency, this topping phase and we could go for a very, very big correction, which if I was to kind of just draw that on here, this is just our, obviously a rough idea, but we could see the SPY, which is trading at about 417 right now, we could see it, you know, have a huge correction and go all the way back down to 2015, 2016 pricing and see a massive wipeout, which may seem severe. But, it's really just a 50%, 60% correction which we have seen this happen over and over during stock market corrections in the past.

I feel like this is going to be one of those major ones that is going to devastate people who don't know what potentially is coming around the corner. And this could take a long time to recover. We're talking maybe five, 10 years for the stock market to recover. So that's kind of the big picture view going into the end of the year is expect volatility. I do think the stock market could have a final push and rally. This is seasonality-wise, the stock market likes to go up into the end of the year and we've seen a very strong bounce, which we can jump to the charts where we're at now and get an idea of kind of where we are. But... So that's kind of the high-level view of the cycles that have taken place and two cycles that are in the middle of one starting and the stock market one is potentially topping. So huge life-changing moves coming around the corner here.

Craig: It's fascinating, Chris. And you're making me... I kept looking at those charts, especially like gold and equities that we can take back almost 50 years. I was just, I don't know, somebody was interviewing me about a week ago and I was, I kind of got off on a tangent about how much this time reminds me of the late 70s. You know, I mean, I was 10, 12 years old, but I was paying attention, you know, and you had stagflation. economic malaise. You had the U.S. as kind of a declining superpower, loss of confidence, trouble in the Middle East with Iran taking U.S. hostages, all that kind of stuff. And that was, and you also, as you related to stock, gold had bottomed out in about 1975 or six and then ran into 1979. The stock market was being driven by what they called the nifty 50. Now we've got the magnificent seven. I mean, they're just, you know, it's not necessarily repeating, but rhyming, as they always say.

Chris: Yep.

Craig: And so here we are again. The key will be understanding, like you said, what's in a secular uptrend and what's in a long-term downtrend. There are counter-trend moves in each, but you've got to watch that. I want to finish up with a couple charts of the S&P, and then we'll maybe look at gold. S&P is, to me, quite interesting in that it's been moving down from that peak on the short-term chart just this year, making lower lows and lower highs. Each bounce takes it up to kind of a round number around 4500, then 4400, then 4300. And as we record this, we're pretty darn close to 4300.

Chris: Yeah.

Craig: What do you see in this and what is something that people should be watching as they manage their equity investments into year-end?

Chris: Yeah, I mean, when we look at all the sectors, if you break the market down into, you know, 30, 40 sectors, almost every sector is in a short-term downtrend, and they're in a long-term downtrend. So there's not a lot of power behind this move. And the move that we've seen just the first week here, or the first couple days of November, is really at this point, a reaction low meaning it's just an oversold level of people covering their shorts, people piling in. Now, people are covering their shorts and probably trying to pick a bottom, so they're going to buy, expect to move higher. But there's not a lot of momentum here. I mean, I would say the market is getting very close to a resistance area. I mean, it's at a huge pop. Today, we had some news the previous day today's kind of carry through. And what's interesting is actually if we take a look at the the SPY, for example, we have a huge, huge gap on this chart from where price opened up for this session compared to the previous session, and gaps on the chart almost always get filled on the SP 500.

For example, I mean, this goes over and over again, but there was a big gap right over here. And the market had to come back and fill that gap.

Craig: Back in July.

Chris: And so now we've got another big gap. And the market is going to want to, you know, at least come down and fill that. And the big question is, is it going to pick up speed and continue to have a waterfall sell-off? Or is it going to try and build a little bit of a launch pad here and try to go up for an end-of-year rally, which it's very possible we see an end of year rally over the next month and a half, two months, where we've come up to maybe this high that we saw just a few months ago. Maybe there's some huge squeeze and it pokes up to a massive double top. We'll just have to see how that goes. But right now the market trend is down. This is a reaction bounce. It doesn't mean that this is the start of a new trend. We actually need more price action to the upside and we need it to hold its ground and build a bull flag or something strong. We want to make sure money is moving into growth sectors, into kind of high-risk sectors. But at this point, none of that's really happening.

This is just a technical bounce. And, you know, when you look at the price action on these charts, you know, this bounce from the low to where it is now, that's almost a 5% bounce. This one here was 4%. You know, another 5%. These happen over and over again during downtrends. There's a 10% almost. Here's like a 12%. So this type of price action that we have right now does get people excited. Because volatility is like a bug zapper light. It literally attracts aggressive traders. They want to start trading options and leverage the ETFs. It's actually a more dangerous time to trade. You want to step, in my opinion, away from leverage, unless you're very good on the short-term trading momentum side. But this is really just a technical bounce and we have to see if it has some legs behind it.

Craig: I'm sitting here laughing because you called it volatility is like a bug zapper. You ever heard the Norm MacDonald moth joke?

Chris: No.

Craig: Okay. Well, you and everybody else listening, it's clean. It's a clean joke, but it's classic Norm MacDonald. So at some point, just remember to look that up. You can go to Google it. Anyway, that's beside the point. I digress. We need to now kind of wrap up with gold because, again, it has been what a remarkable month and there are a couple of things going on here. Geopolitics obviously drove it off the lows that, you know, after every events began to unfold in Gaza and Israel, the second week of October. And, however, that also is impacting monetary policy, the likelihood, you know, interest rate hike expectation began to fall as well this month. Then you got some confirmation of that from Powell just yesterday. What do you see in that gold chart? We finally made a higher high, broke that trend of lower lows and lower highs. What do you see there and what should we be watching as we go into really what is usually a pretty seasonal strong period for gold too?

Chris: Yeah, I mean, yeah, we definitely saw some drivers really help juice gold to the upside. And, you know, one of the things why I think we've seen a lot of volume in gold and we saw a strong surge through here is in part of all of these little highs that we have. So we've got all these nominal little highs that make slightly higher highs, the closer they are clustered together. Anybody who's short, excuse me, anybody who's short gold as it starts to break a previous high, they're going to want to get out because now it's making higher highs. So they have to buy back their short. There will also be a group of people that say, "Well, I want to own gold because it's starting to break highs. It's starting to move higher." So with all of these layered in here, this is where you get a running of the stops, and you'll usually see a huge momentum move up and then it'll kind of flush out, which is exactly what happened. We saw big volume, a strong move and now it's just kind of trying to dealing with kind of overhead resistance.

So there's definitely a strong momentum move here. All the shorts more or less, I think have been run out because of all of these little stops. And gold's trying to figure out, you know, what it's going to do next. It is definitely lingering up near all-time highs. It's in striking distance to push higher and get up there. Excuse me. But the dollar is definitely gonna be I think a key player here. If we look at the dollar index, it has been holding its ground trading sideways and I think a lot of it is still gonna come down to what the stock market does. If the stock market falls out of bed and sells off into the end of the year, like we saw a couple of years ago, or is a terrible close to the year, the dollar is gonna shoot higher and that means that there's panic in the stock market. There's gonna be like forced liquidation and gold will not only get sold off just from fearful money and liquidation events happening, but the rising dollar is gonna also kind of hold it down.

So to me, we're in this big limbo here. We've got the dollar trading sideways. We've got gold trading up in this upper resistance zone right up in here. And I think it can fluctuate through here, no problem over the next little while, but I don't really see gold breaking out and starting a huge run yet. I think it's still going to consolidate for several months or pull back more before... I think we still need a little bit of a financial reset, unless things kick up with global things that spark gold to skyrocket. But I think gold is struggling. I think there's a lot of, you can just see the price action here. We got whipsaw price action. It keeps, it runs up and sells down. It gaps higher, it sells down. It's the same type of noise that happens up here. There's definitely sellers lurking up in this area. And it's just a spot, I think a lot of people, they're not so much piling in to buy it at this point. It's more like there's distribution, some selling still going on up here.

Craig: We're just kind of waiting. I mean, I've been writing about it all year. You know, it's when the Fed does finally pivot, you know, when the rate cuts do actually begin that things get rolling. And even if we can just maintain near 2000 for when that finally begins to happen, I mean, we could have quite a move to the upside. Like you said, you've got to, there's got to be quite a few stops up there or above 2050, and 2100, right?

Chris: Oh, yeah. Yeah. It'll be interesting to see.

Craig: It would, yeah. So that day is coming, but I don't know, at least if anything, it sure feels better to be at 1990 versus whatever, 1820, the last time we spoke. I think that puts a lot of smiles on people's faces or at least makes it a little more manageable emotionally.

Chris: Yeah. Yeah.

Craig: Chris, it's always a pleasure to visit with you and you've always got such great insights. Again, please tell everybody about where they can find you and what they can find at thetechnicaltraders.com.

Chris: Yeah, sure. If you like this type of analysis, I do it every morning before the opening bell. In shorter-term charts, we're always looking at what happened yesterday and overnight trading and for the week ahead. You can go to thetechnicaltraders.com. I share all my trades and I cover all the commodities, natural gas, oil, precious metals, uranium stocks, all that stuff. And I share whatever trades I put on, I share with members there at thetechnicaltraders.com.

Craig: Perfect. And, again, everybody, just a reminder, there will be all kinds of content coming from Sprott Money as we go through the month, Ask the Expert. And by the time we get to the end of the month and another Monthly Wrap-Up. We just actually recorded the October Monthly Wrap-Up yesterday, the day before, with John Rubino. So if you haven't seen that yet, look for that. You can find it on the Sprott Money page under that Insights tab up in the navigation bar. You can actually go to any place else that you follow Sprott Money's content, you'll find that John Rubino audio and video. There'll be more to come, so follow and give a like or a subscribe to whichever channel, or to whichever content channel that provides this, whether it's YouTube or wherever else you'd find Sprott Money stuff since you're always notified when there's new content. And it will remind you to visit Sprott Money during the course of November. Check out the Holiday Gift Guide, get ready for the sale that begins in a little over a week or so, and then do yourself some shopping.

Give your loved ones, show them how much you love them by giving them some sound money, something that will endure has been money for ages and begin their education process. Again, continue that education process at thetechnicaltraders.com and then come back for more content as we go through the month. Chris, thank you so much for your time. Every single month I learn something and I'm sure everybody watching does too, and I hope you have a great month of November.

Chris: You too, always a pleasure, Craig. Take care.

Craig: And from all of us at Sprott Money, sprottmoney.com, thank you very much for watching, and have a great rest of your day.

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About the Author

Our Ask The Expert interviewer Craig Hemke began his career in financial services in 1990 but retired in 2008 to focus on family and entrepreneurial opportunities.

Since 2010, he has been the editor and publisher of the TF Metals Report found at TFMetalsReport.com, an online community for precious metal investors.

*The author is not affiliated with, endorsed or sponsored by Sprott Money Ltd. The views and opinions expressed in this material are those of the author or guest speaker, are subject to change and may not necessarily reflect the opinions of Sprott Money Ltd. Sprott Money does not guarantee the accuracy, completeness, timeliness and reliability of the information or any results from its use.

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