After a bruising four-year decline, gold is showing nascent signs of strength. But it has not yet triggered a major buy signal. Dusting off our long-term charts, here are three indicators likely to confirm the next major advance in dollar/gold:
1. Buy gold when Coppock momentum exceeds zero.
2. Buy gold after multiple observations of 12-month highs in all major currencies.
3. Buy gold when U.S. equities are under-performing gold.
Conclusions? Gold is beginning to show signs of life. But it hasn’t yet triggered a long-term buy signal. Remember the old adage: “There’s no fever like gold fever.” There should be plenty of opportunity after a bull market is confirmed. It’s okay to be late to the party.
