Friday Recap (1/17/2025)

AU: $2702 ($2692 - Last Week Spot)
AG: $30.31 (30.32)
HUI: 296 (292)
DXY: 109 (109)
S&P: 5996 (5826)
10-Yr: 4.6% (4.7%)
Oil: $77 (76)

Not much happened this week, except the CPI for December came in at 2.7%, which was below expectations. This got Wall St excited, and the S&P closed up this week more than 150 pts. The 10-Yr rate was nearing 4.8%, which had Wall St nervous, and closed the week at 4.6%, back below the warning level. I remain bullish that the S&P will trend higher in Q1. My target is 6300. Of course, that's just a ballpark guess, but I expect to see the 2025 cycle high reached in Q1 and close to that number.

You may think gold was strong this week, but it was only up $10. Silver was down 1 cent, and the HUI remained under 300. Both continue to lag gold. I do not expect the HUI to reach its breakout level of 350 in Q1, or for silver to reach its breakout level of $35. They will trend a bit higher, but it's a fake-out, and lower lows are coming. My targets are 245 to 265 for the HUI, and $26 to $27 for silver.

The good news is that gold is not likely to crash in 2025. My 2025 low target is $2350 to $2450. That target (if achieved) will feel like a crash because it will come quickly, but it won't be a deep correction, and it won't last long. The only question is, where does gold bounce? Because we will get a bounce in gold. The odds are very good that gold is going higher this year.

We are back into our waiting game. Some TA gurus think gold and silver are in a breakout and will rip to $3000+ and $35+ without a correction. I'm rooting for them, but I think those moves will get rug-pulled by a deep correction in the S&P. It's possible David Hunter is right, and we will see a massive melt-up in everything, but I don't expect it.

Many believe that Trump's policies will push the economy onward and upward. It could happen, but I think he is being handed a big mess that can't be cleaned up. The budget deficit is massive, inflation continues to bite, high interest rates aren't coming down quickly, many economic sectors feel like they are in a recession, and his worst problem is the downward trend of the economy. How does he turn the economy around? He's going to need a magic wand.

Nobody will admit it, but this is the worst shape the US economy has ever been in. We are trapped. Once the S&P falls below 5000, the rose-colored glasses will come off, and everyone realizes that we are screwed. Why? Because both the Fed and the UST will be out of moves, or any move that they make will have ugly consequences. The downward spiral has already started, but no one has noticed. Well, almost no one -- you can check out Jeffrey Gundlach's latest podcast. He sees it.