Precious Metals-Has Anything Really Changed?

June 9, 2024

Mish's Daily

By Mish Schneider

While we never profess buying a falling knife, we do believe that the metals are probably setting up for a buyable dip this coming week.


Looking at the fundamentals, it seems nothing has significantly changed.

The news story that China paused buying gold after an 18-month buying spree could be nothing more than smart trading.

After all, the dollar rose Friday along with yields, and China has been a seller of both.

Hence, selling the dollar and yields higher whilst buying gold cheaper is timely.

Is China, though, done completely?


However, let’s look at some other factors which have not changed at all.

  1. Geopolitics-in fact, one could say that Russia sending war ships towards Cuba is yet another concerning factor to add to the list of concerning factors.
  2. Government debt-still rising
  3. Government spending-still rising
  4. Freight costs-still high along with sticky service inflation and now, higher wages
  5. AI and EVs-not going away with only more stress inevitable on raw materials

Now add to the list

  1. ECB and Canada cutting rates-de-globalization or just first before the US joins in?
  2. Even higher for longer-that’s nothing new
  3. Weather-with hurricane season upon us shortly, rising sea temps and heat and floods/drought-don’t underestimate Mother Nature

Which means to us that if the fundamentals remain intact, we must go to the charts for market timing.

The gold cash chart goes back to March.

We had said that gold was a hold your nose and buy once it cleared $2100. The high since then is just shy of $2450.

Then, after gold made that high on May 20th, the next day was an inside day (price remains inside the trading range of the day prior).

That was proceeded by a down day, which put $2450 as a top.

Corrections on such types of chart patterns (brick wall) generally yield a 5-10% drop in prices.

5% is around $2330 and 10% $2200.

Only a move under $2100 would suggest failure and not just correction.

Silver looks better.

Silver futures did not have a reversal top.

Silver did not fail the 50-DMA.

Silver has returned to major support above $29.00

Silver looks compelling this week if holds above $29.50.


Educational purposes only, not official trading advice.

For more detailed trading information about our blended models, tools, and trader education courses, contact Rob Quinn, our Chief Strategy Consultant, to learn more.

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ETF Summary

S&P 500 (SPY) New all-time high last week with no real correction on Friday

Russell 2000 (IWM) 210.80 resistance 200 support with a historical wide ratio between this and NASDAQ

Dow (DIA) 40k resistance yet back into a bullish phase

Nasdaq (QQQ) New all-time high along with Nvidia

Regional banks (KRE) Watching the range 45-50

Semiconductors (SMH) 450 major support and another new all-time high this past week

Transportation (IYT) 63.80 area now important support with 66-67 the area to clear for health

Biotechnology (IBB) 135 support 140 resistance-big eyes here this week

Retail (XRT) 75-80 trading range to break

iShares iBoxx Hi Yd Cor Bond ETF (HYG) Ended the week on critical support 76.85 area-so watch carefully this coming week

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