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Commodities Heading To Multi-Year Lows

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December 2nd, 2018

It looks like commodities, measured by the CRB are descending into multi-year lows. If I’m correct about oil, we should see a significant bottom in the first quarter (Q1) of 2019.

Precious metals typically bottom before oil and the CRB. I think gold will bottom in December – January at the latest.

The indecision and lack of follow-through in miners is consistent with a bottoming process. Prices could be following a similar process to what appeared in late 2015 early 2016. I think we are approaching very tradeable lows.

Timing the bottom in gold could be a bit tricky. Generally, gold bottoms within 1-2 days of the December Fed meeting (December 19). However, the current 30-day cycle supports a low several days later – between the 27th and 31st of December. We should be able to narrow down the proper timing model as Fed-day nears.

GOLD WEEKLY

I’ve been calling for an October top, November decline, and December bottom. The November period proved ineffective and failed to break the cycle trendline (blue). Now prices need to break lower in December. I think we will at least see a retest of the $1167 level before the next bottom. The current structure favors a smaller version of the late 2015 pattern.

GOLD DAILY

Gold typically bottoms very close to the December Fed meeting. This year that event arrives December 19. The 30-day cycle suggests the next turning point (probably a low) should land between December 27 – 31. There’s a small conflict between these timing measures, and it’s unclear how it will be resolved.

US DOLLAR

The dollar is due for a cycle correction, and momentum is fading. However, prices refuse to break the cycle trendline. The December 19 Fed meeting will likely time the next turning point. At the moment it’s unclear if it will mark a high or a low. If it’s going to be a low…then the dollar needs to get serious and break the cycle trendline soon.

 - Gold Predict.

See Also: Commodity Investing News Blog, Crude Oil, Gold, Coffee, Cocoa, Cotton, Orange Juice, Sugar