Precious Metals Can Attract Buyers In Risk Off Situation

The financials markets are slow and did not change much recently so our view remains mostly the same.

Though stocks can go a bit higher, a risk-off situation should follow. And perhaps that will benefit precious metals.

For stocks, there is a chance that the S&P 500 Index is going to make another leg up for a three wave advance (in B).

But I believe the most important area to track is the 10 year US Treasury notes.

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When a triangle is finished there, confirmed by a broken trend line resistance and wave D swing high, that’s when the real risk-off can kick in.

See chart below.

10 Year US Treasury Note Chart

10 year us treasury bond note price breakout analysis risk-off chart

If there is risk that equities can come down, then investors may look for safety in the US Dollar and precious metals.

From an Elliott wave perspective, I think that precious metals are in an early stage of a new leg up.

When looking at gold and silver, the recent price action looks corrective: three legs down on gold to 1704, and also big three legs down on silver to 16.93. This could lead to a new leg higher.

XAU/USD Gold “4hour” Trading Chart

gold price elliott wave analysis forecast summer higher highs bullish chart

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The authors may have a position in the mentioned securities at the time of publication. Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.