Patience Through the Seasons

Gold bugs continue to be understandably frustrated with the price action in precious metals/miners, what with the fits and starts, head-fakes higher and gaps lower such as yesterday and today. 

However, as we have noted quite a few times since winter both here and with Members, despite our steadfastly bullish long-term views on the yellow metal we still expected an extended consolidation. Indeed, part of long-term bull markets, especially in commodities, means suffering through several seasons of tedious corrections before the next launch point higher. 

The good news, though, is that gold seems to be "getting there."

Specifically, the GLD ETF, on the first daily chart, below, still has not precisely tested its 200-day moving average (yellow line) in several years. That is, of course, an abnormally long period to go without price testing that key long-term reference point.

On the one hand, not testing the 200-day for so long is a sign of impressive strength during the most recent multi-quarter advance. On the other hand, at a certain point you almost need to step aside and let the overdue test play out, which has basically been my view since the winter months as far as trading goes (despite still holding physical gold and some miners in my long-term investing account). 

As you can see, GLD is almost there and likely will test that 200-day in the coming weeks. Now, the 200-day is not an automatic place to buy. But it certainly offers a well-defined battleground into the early part of the summer. If gold bugs are still unable to tighten things up, then I continue to target late-summer/early-autumn for the next actionable long entry for gold, when seasonality is more bullish. 

Elsewhere, in addition to software play Salesforce earnings tonight we also have Marvell, the Santa Clara-based AI chip play which has been one of several monsters in the SMH ETF. The MRVL quarterly chart, second below, seems to confirm my view of a blow-off move in recent months, noting the sheer size and magnitude of that quarterly candlestick, in progress.