Can Gold Get To $4000 By June?

Is there a realistic scenario where gold can reach $4000 per ounce by the end of June? It's an absurd scenario but let's have fun with the idea, could it actually be crazy enough to happen? Last November I laid out the path for gold to reach $3000/oz by the end of Q1. I followed up with that in mid February and updated my price target to $3,076 - $3,100/oz by mid April at the latest. Spot price crossed $3,000 on March 14th, hit $3,085 on March 28th then followed up by overshooting the $3,100 handle by roughly $50 or so. After that it had a brief but sharp decline which led me to believe it had likely topped out and was entering a consolidation phase based on the reasons provided in the aforementioned articles. Today it made new highs as is now well over $100 past my original measured move target. Normally I would simply chalk this up to an exhaustion movement which can sometimes be a part of the topping process and for all we know, it could end up being just that.

This move could just be an exhaustion high

However, the behavior of another asset gives me pause to this idea - gold miners. The rule of thumb with the gold market is that the miners should lead the metal in order to confirm whether a move in spot has conviction or not. That rule has essentially thrown out the window over the last 2-3 years as miners have dreadfully lagged spot price but today they did not.

GDX closed at multi year highs

The move today in GDX was impulsive and it carried the ETF to new multi year highs. This is happening while technical targets and seasonal flows are pointing to a metals market that should be seeing topping effects and potential headwinds. If anything, the typical play here would be to maybe see spot popping (perhaps the exhaustion move mentioned above), and miners showing signs distribution or laggardship which would confirm the topping signal in spot price. Why then have miners only just now decided to impulsively outperform and reach multi year highs? Why have they only done so after spot has already rallied well over $1,000 past it's previous $2,100 cap that has essentially stood for the last decade? One answer to that could still fit in with the exhaustion theory in that shorts had simply taken enough and decided to capitulate on their mining stock short positions. If this is the case we'll likely soon see a reversal followed by a consolidation phase which is on cue with what I had expected to happen by mid-April. Who knows, may gold decided to deviate from the near perfect $550 measured move advances that it had made like clockwork over the last couple of years because it wants to go test the 1.618 fib extension from the 2015 lows to the 2020-2022 structure. This sits at about $3,280 but we could also call it even at $3,300.

Gold 2015 fib extension target

Maybe that's it and maybe it stops the advance there. But what if it isn't? What if gold miners are signaling that the reason gold has exceeded these measured move targets is because it is about to go vertical? No, only a sensationalist grifter would suggest that gold could reach $4,000 by the end of Q2. There's no way that asset prices just move that fast. Except they do.

AAPL 2024 measured move

I was laughed at last year when I suggested that the year long consolidation base in AAPL would lead to a measured move target of about $240/share. It ended up exceeding that by $20 later that year. AAPL has a comparable beta and market cap to gold but if you want a better example let's go to the horse's mouth -

Gold percentage gain from November to March

From the end of November to the end of March gold rallied roughly 24% from the low to the high. If it does in fact begin to go vertical why can't it rally another 24% over the next quarter into the end of June?

Path for $4000/oz gold

Yes, I know it is still a very improbable move and we could easily see a sharp mean reversion next week in front of April opex that all but negates this idea. However, I suggest keeping an open mind because blow off moves ARE by nature improbable, irrational, and absurd. I have traded through enough of these types of vertical moves to know that the reason they end up going as far as they do is because the majority of market participants refuse to believe it, and many end up losing limbs trying to fight it. Also, yes the chart is going up, and going up fast but speaking as someone who traded through the metals super cycle in 2010-2011 I can promise you that this is nothing close to euphoria. We are not seeing penny stock miners becoming 5 baggers on a daily basis without reason or warning, and COT reports are showing fairly healthy positioning and trimming from large speculators. To be clear - in no way am I "calling" for this scenario to happen, I am simply trying to have fun with the idea while also hopefully provoking some critical thought since we as traders often fall into the trap of thinking in absolutes. 🔐For access to premium trading content including swing trade alerts & live day trading room visit 👉 - https://www.carnivoretrades.com/ 

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