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Jeff Cooper: Is Gold About to Explode?


“Prices are governed by Time
Time causes Prices to change.
Time angels are resistant to Price.”

-W.D. Gann

Yesterday's report shows gold's big picture ending down-wedge.

As indicated, a breakout over the declining trendline could trigger an explosive advance.

See weekly gold from yesterday here again:

At the same time gold shows this ending down-wedge, the SPX monthly chart shows what appears to be an ending up-wedge.

Recently, we walked through the synchronicity between the time and price vibrations in the SPX that tie to June and September historically.

Now we looking at a mirror image pattern.

Note how the peak in 2015 defined the upper rail for this ascending wedge, and perpetuated a decline that ties to the lower rail of this pattern.

The subsequent rally from the Jan/Feb 2016 lows accomplished a few technical measures.

The current tag of the upper rail now satisfies an important 3rd touch since the May 2008 pre-crash pivot high of 1440.

The rally off the early 2016 low also connects:

1) the lows from the November 2008 crash low (the decline in Q 1 2009 was a bried, albeit deep undercut of the 2008 low)


2) The big 2011 low and the early 2016 low

Now there is an important 3-point rising trendline connecting lows with a 3-point trendline connecting highs.

The thing is, Mr. Market has a nasty habit of not delivering picture-perfect patterns.

In other words he often overthrows idealized patterns.

So will the SPX overthrow the top of the red rail, just as there was an undercut of the November 2008 selling climax?

Interestingly, the undercut into the March '09 low was 75 SPX points.

A similar 75 point overthrow now from the idealized 2401 level ties to 2476 — very close to our idealized 2482 level.

Does Mr. Market owe us a trip to 2482?

No, he owes us nothing from this point.

We have two closes over 2401 on the table. And usually holding a breakout level for 3 days confirms it is ‘legitimate'—at least for an extension higher.

This morning we're getting a down open, but remember, bull markets in like new closing highs on Fridays.

At the same time, the bulls would especially love to see a new closing high going into a long weekend. That could work in their favor.

But you never know, they could get nervous too.

Does the SPX owe us a buying climax into the summer?

As you will recall, there were a cluster of cycles due to hit in mid to late May and any breakout here has the potential to fail.

It will be easy to see that on a knife back below 2400 that sticks.

The question from where I sit is whether we get a little peek or a big peek over 2400.

Or will this ‘clear-cut' Peekaboo over 2400 scare the bulls if no one chases it?

There is a lot of symmetry at 2482.

In addition to being an important 12 squares up from the 666 low, it is also 6 squares up from the 1440 pre-crash pivot high in May 2008.

We are precisely 9 years from the May 2008 pivot.

That is 108 months ago.

On my Square of 9 Wheel, 108 aligns with the first week of June.

We also know that 2482 and 666 are on the same vector as June 6.

As is the SPX low of 62 in late 1974.

That was 509 months ago, which is 90 degrees square May.

You can't make this stuff up.

This 509-month cycle defines the big Low to Low to High (possible) cycle reported to you over the last few months.

It ties the 1932 low to the 1974 low to May 2017.

Click to enlarge

Additionally, the 2007-2009 bear market was 910 SPX points.

Adding 910 points to the 1576 top from 2007 points to 2480.

From the 666 low to a theoretical 2482 target is a range of 1816 points.

1816 SPX ties to the last major low in early 2016.

This is compelling because from the 2012 low to the current time frame is 1816 days.(666 + 1816 = 2482.

At the same time, there are 2519 days between the first major higher low and the current time frame.

So we're in the time/price wheelhouse.

Is it possible if the market stood on its heels to see a buying climax ala 2000 that saw the SPX spike and reverse over 2500, and settle at around 2480?

Conclusion. Gold is threatening to break out over its ending down-wedge this morning. This is occurring as the dollar is flirting with a break of 97 which could see an extension to 94-95.

Below that means a panic.

At final highs and lows in the market, there are usually currency ‘handoffs' from one country to another.

Perhaps the dollar has seen an important top. Perhaps a decline in the dollar dovetails with a flight to safety OUT of US assets.

If the Trump agenda can help the dollar big league, but if it falters or stalls, it could lead to stagnation and inflation, and the dollar could be hit hard.

What if the unwind of the $4.5 trillion Fed balance sheet can't be managed as smoothly as market participants perceive?

This could cause the up-wedge in the SPX to collapse, and gold to explode over its ending down-wedge.

(Click here to enlarge)

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