Pullback to a Higher Low or Lower Low, Then Launch

by David Brady Sprott Money

Last week, on October 5, I wrote that all the conditions were in place for a massive move higher in Gold and Silver, and I provided a list of reasons why. That day turned out to be the low for metals and miners. Since then, Gold, Silver, and GDX have risen 4%, 7%, and 11% respectively. However, we are not out of the woods just yet.

No material resistance has been broken to confirm the bottom is in for the entire sector. All rallies begin with a higher high, followed by a higher low, then a breakout of the previous peak. What we have so far is a healthy bounce off the lows to “suggest” the rally to new record highs has begun.