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DEC GOLD
This morning’s break below 18-Nov’s 1456.6 low confirms the bearish divergence in momentum we alluded to in 20-Nov’s Technical Webcast and renders mid-Nov’s recovery attempt as a 3-wave affair as labeled in the 240-min chart below. Left unaltered by a recovery above 20-Nov’s 1479.2 high, this 3-wave recovery is considered a corrective/consolidative event that warns of a resumption of early-Nov’s downtrend that preceded it to new lows below 12-Nov’s 1446.2 low. Per such, last week’s 1479.2 high serves as our new short-term risk parameter from which the risk of a still-advised bearish policy and exposure can be objectively rebased and managed.
![](https://rjofutures.rjobrien.com/images/2019/11/gold-dec19-240-min-chart.gif)
![](https://rjofutures.rjobrien.com/images/2019/11/gold-daily-chart.gif)
This latest smaller-degree corrective evidence remains consistent with our broader peak/reversal count introduced in 10-Sep’s Technical Blog stemming from that day’s bearish divergence in momentum, historically frothy bullish sentiment and a complete wave sequence up. Given the extent of May-Sep’s impressive (and prospective 3rd-Wave) rally, the past couple months’ relapse still falls within the bounds of a (prospective 4th-Wave) correction ahead of a resumption of the major bull. But to resurrect such a count, the market has to recoup at least 1479.2 and preferably 01-Nov’s 1519 larger-degree corrective high and key risk parameter. Until and unless such strength is proven, there’s no way to know that a major reversal lower isn’t at hand, with a dramatic 3rd-Wave down just ahead.
These issues considered, a bearish policy and exposure remain advised with a recovery above at least 1479.2 required to threaten this call and warrant paring or neutralizing exposure. In lieu of such strength, further and possibly protracted weakness is anticipated straight away.
![](https://rjofutures.rjobrien.com/images/2019/11/gold-weekly-chart.gif)
DEC SILVER
![](https://rjofutures.rjobrien.com/images/2019/11/silver-240min-chart.gif)
while the silver market hasn’t yet broken its respective 18-Nov low at 16.705, we believe the technical construct to be similar enough to that detailed above in gold to identify Fri’s 17.21 high as the end of a 3-wave and thus corrective recovery from 12-Nov’s 16.615 high, warning of a resumption of early-Nov’s downtrend that preceded it. Per such, we are identifying that 17.21 high as our new short-term risk parameter from which a still-advised bearish policy can be objectively rebased and managed.
![](https://rjofutures.rjobrien.com/images/2019/11/silver-daily-chart-1.gif)
If there’s a difference between gold and silver, it’s from a long-term perspective with silver still locked deep within the middle-half bowels of its 4-year range shown in the weekly log chart below. Such range-center environs are considered fertile ground for aimless whipsaw risk that we believe warrants a more conservative approach to risk assumption. Herein lies the importance of smaller-degree corrective highs and risk parameters like 17.21.
In sum, a bearish policy remains advised with a recovery above 17.21 required to threaten this cal enough to warrant its cover. In lieu of such strength we anticipate a resumption of Sep-Nov’s downtrend to indeterminable levels below 12-Nov’s 16.615 low.
![](https://rjofutures.rjobrien.com/images/2019/11/silver-weekly-chart-1.gif)