Siren Call - Gold Update

 According to legend, the Sirens song is both sad and beautiful. Those who hear it, can't resist, which ends in their death.

Shills...

...were out in force last week. Their song is that we are now in a Bull Market. They base their lyrics on the aspect that the SPX has risen 20% from its October lows. Sounds good, right? Well, we at Evolution do not agree. One reason is we believe this concept is flawed. To us, a new bull market would prove itself if it can climb higher than the last high. We even indicated in our last piece that we feel that this rally has legs. With that said, the SPX would have to climb to 4819 to show us belief. We do not see this. If you buy the dip, keep this in mind. The market can go sideways for a long time. Case in point: From February 1966 to November 1982, it remained in consolidation. There are many other price actions like this. Check the charts! Then, add this aspect. When the market climbs, it is a slow staircase upward. When it falls, the elevator goes down in express mode. The siren call could wipe out your nest egg. 

One Last Point

Many concepts like the 20% move in price action are used to manipulate our thinking. The Fed is the king at this. They repeat something so often that we take the point as truth. It isn't! Case in point: How can you measure inflation without the three most important things that we need, food, energy and shelter? We have our own siren call, End the Fed!

Gold

We haven't talked about precious metal in a while. Our timing is not good. At the moment, it is in a downtrend. We see it possibly falling to and testing $1880. It has acted strangely to say the least. It hit a new high at $2078 only to fall to a lower low at $1618 in 2022. Since then, it formed a new high at $2085 and now, it is retracing. We would like it to hold $1902.

If you remember the debate on how gold would react to the Fed's tightening of rates, it turns out to be just noise. King Dollar affects gold as well as all commodities more than rates. At present, the dollar looks like it will test 106. This puts pressure on gold and commodities. We also have another Fed meeting. We see the market turning sideways after this rally stalls. Sometime around August, gold will wake up. We see a new all-time high of $2150. The strength of that rally will determine its next move. The more the dollar weakens, the higher the metal will rise.  Peace.