Friday Recap (8/30/2024)

AU: $2502 ($2509 - Last Week Spot)
AG: $28.81 (29.77)
HUI: 313 (318)
DXY: 101 (100)
S&P: 5668 (5631)
10-Yr: 3.9% (3.8%)
Oil: $73 ($75)

Stocks were up and gold/silver/miners were down for the week. The story remains the stock market, which continues to remain strong, ending the week near an ATH. The DOW actually traded at an ATH this week. Until the stock market tops out, gold will trend with stocks. I wish this was good news, but it's not. This is not what we want. Yes, gold is high at $2500, but the miners remain stuck. The miners are the signal we should be paying attention to. What are they telling us? The gold miners should be trending, but they aren't. Thus, a rug-pull is coming.

We can expect the stock market to top out in the next 30 to 90 days. That will be the de-coupling moment. Initially, gold will go down with the stock market, but at some point, it will get a bid and head higher, ending the year around $2600 to $2700. Meanwhile, stocks will crash more than 20% between now and year end. The upside for stocks and gold in the near term is minimal. We might see the S&P go to 5700, but I doubt we'll see 5800. Gold might rise another $100, but that's about it. Conversely, the rug-pull will take down stocks over 20% and gold 5% to 10% (to around $2250).

The only number to watch is the S&P 500. Once the S&P gets below 5200, the stress begins. Above 5200, and Wall St will remain claims. Below 5200, and we enter the 5200 to 5000 first stress zone. This is when everyone hopes and prays that we bounce, and only the smart money exits. The next stress zone is 5000 to 4800. This will be the last chance zone for many investors. So, if 4800 doesn't hold, many investors will jump off the ship. The last chance zone is 4500 to 4800. This is the last chance for the stock market to hold. If we go below 4500, then we likely have a recession and we are going down hard.

I'm expecting the stock market to reach a bottom in a slow process, over a period of 3 to 6 months. I do not expect a crash. This is going to be a slow bleed. Ultimately, I think we bottom out around 3000 (+/- 250 points). However, once we bottom, do not expect a rebound. This is when the recession takes hold, and it will last 2-3 years. I expect 2027 to be the worst year. So, the economy will progressively get worse in 2025, 2026, 2026. Note that gold and silver will shine during this period.