It is increasingly possible that the recent correction in metals has ended following the strong rebound in miners, although it is still too early to confirm. We ideally need to see five waves higher from the lows, while so far we have only identified three. The current price action could be developing into the final stages of wave C or wave 3, followed by a wave 4 correction and another wave 5 higher, which would provide stronger confirmation of a bullish reversal. However, any strong and impulsive decline from current levels would suggest that the correction is still underway.
Gold
Gold remains in recovery mode and is now testing previous highs. The price action is increasingly suggestingwave (3)rather thanwave (C), although the wave (C) scenario should still be considered.
Gold could still be completingwave 5of a lower-degree impulse, so the next decline should provide more clarity. If we see aslow, choppy and overlapping pullbacktoward the4357–4300 support area, it would ideally represent wave (4) of an ongoing five-wave bullish impulse. Such a structure would also provide confirmation of a bullish reversal on the higher time frames.
On the other hand, astrong and impulsive five-wave decline below 4200would suggest that wave (C) of the larger ABC correction has completed, keeping the bearish scenario in control.
Silver
Silver also remains in recovery mode, with the current structure increasingly favoringwave 3 rather than wave C, as price has already extended into the Fibonacci cluster target area for wave 3.
The broaderrisk-on environment, supported by bullish stocks and a weaker US Dollar, could be contributing to a larger bullish reversal in metals. In the short term, Silver may still be advancing withinsubwave “v”of a lower-degree impulse.
However, traders should watch for a potential slowdown around67.00, where awave 4 correctiontoward the64.00–63.00 support zonecould develop before another move higher.
Risk-On Environment Supports Metals
The broader market backdrop remains important. Stocks are still bullish, and this strong risk-on environment is increasingly supporting metals as well. Further gains in equities, combined with additional weakness in the US Dollar, could allow Gold and Silver to extend their recoveries.
Treasuries could also be approaching a potential temporary support within the final leg of a diagonal formation. If that support holds and Treasuries rebound, it could provide another supportive factor for metals.
For now, the key is to monitor the next corrective pullback.A slow and overlapping decline would favor a bullish continuation, while a strong impulsive selloff would warn that the larger correction is not yet finished.
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