On May 17 we wrote that the next cycle low for gold is due on June 11th, give or take 4-5 trading days. Last Wednesday's plunge in spot gold from $1641 to Friday's low at $1564 (6/06-6/08) appears to coincide with my expectation for a major cycle low.
Spot gold has rocketed today from $1588 to $1618. If it IS a cycle low, then spot gold is in the very early stages of a new up-leg within its dominant multi-year bull market.
In our comparison chart with the e-SPU and EUR/USD, we see that neither one is even close to confronting its high on Sunday evening after the Spanish bailout news, which presents us with additional evidence that gold continues to differentiate itself from the other risk-on/off markets -- for whatever reason.
At this juncture, spot gold appears headed for a test of critical resistance at $1634.00-$1640, which if hurdled, should trigger upside continuation to $1680-$1700. ETF traders may want to keep an eye on the SPDR Gold Shares (GLD).