After a 4-week bottoming process the dollar finally closed above the short-term trendline. We should see a rally for 1-3 months. Possibly longer if prices aggressively break through the 6-month trendline.

Metals and Miners should be closing in on daily cycle lows. Gold, GDX, and the XAU are near their respective support zones. I’d be surprised if prices bounced before testing them.

The XAU forms interim highs/lows every 23-29 trading days. It’s been 23-days since the May 88.01 high. If the cycle continues, we should see an interim low between now and next Wednesday. The next swing low should mark the bottom.

-US DOLLAR- The Dollar closed above the short-term trendline, and a low is likely. Prices should work their way higher to test the 6-Month trendline. If prices surge through that trendline, we could see a run to new highs.

-GOLD- Prices fell to the 200-day MA. A drop to the intermediate trendline (around $1,230) seems logical before prices attempt to bounce.

-SILVER- Prices continue to decline. If gold drops to test the intermediate trendline ($1,230), silver should retest the $16.06 low.

-GDX- Miners have held up better than I anticipated the last two days. Nevertheless, a drop back to the $21.00 region makes sense before prices try to bounce.

-GDXJ- The rebalancing has skewed the chart versus the XAU. Nonetheless, prices are testing the May trendline, and closing below it could lead to additional selling.

-XAU- Prices form interim high/lows every 23-29 (average 26) trading days. It’s been 23-days since the 88.01 high. We should see a low between now and next Wednesday. Prices will probably bottom when they retest 77.50.

-SPY- Prices gapped higher yesterday but dropped immediately to close the gap today. Closing below the 10-day EMA tomorrow could lead to a pullback.

-WTIC- Prices dropped after forming another small bear flag. Oil could be closing in on a bottom…if the positive divergence in the XLE holds (see XLE chart).

-XLE- The XLE remains above the June 7th low. The energy sector could be on the verge of a rally if this divergence holds. Prices must remain above the $64.16 low; breaking it would void the divergence.

Metals and Miners could be close to forming daily cycle lows. Prices should drop a little further to test support. The next swing low should identify a bottom.

As I’ve said before, this part of the cycle can get tricky. Precious Metals likes to catch investors offsides. A bounce from gold’s intermediate trendline seems logical, but that doesn’t mean it will happen. Prices could rebound before hitting it, or they might collapse straight through.

Whatever the case, we are weeks away from registering a 6-month cycle low. Investor sentiment should turn decidedly bearish before prices record a meaningful bottom, we are neutral at best.