• 261 days Will The ECB Continue To Hike Rates?
  • 261 days Forbes: Aramco Remains Largest Company In The Middle East
  • 263 days Caltech Scientists Succesfully Beam Back Solar Power From Space
  • 663 days Could Crypto Overtake Traditional Investment?
  • 668 days Americans Still Quitting Jobs At Record Pace
  • 670 days FinTech Startups Tapping VC Money for ‘Immigrant Banking’
  • 673 days Is The Dollar Too Strong?
  • 673 days Big Tech Disappoints Investors on Earnings Calls
  • 674 days Fear And Celebration On Twitter as Musk Takes The Reins
  • 676 days China Is Quietly Trying To Distance Itself From Russia
  • 676 days Tech and Internet Giants’ Earnings In Focus After Netflix’s Stinker
  • 680 days Crypto Investors Won Big In 2021
  • 680 days The ‘Metaverse’ Economy Could be Worth $13 Trillion By 2030
  • 681 days Food Prices Are Skyrocketing As Putin’s War Persists
  • 683 days Pentagon Resignations Illustrate Our ‘Commercial’ Defense Dilemma
  • 684 days US Banks Shrug off Nearly $15 Billion In Russian Write-Offs
  • 687 days Cannabis Stocks in Holding Pattern Despite Positive Momentum
  • 688 days Is Musk A Bastion Of Free Speech Or Will His Absolutist Stance Backfire?
  • 688 days Two ETFs That Could Hedge Against Extreme Market Volatility
  • 690 days Are NFTs About To Take Over Gaming?
Zombie Foreclosures On The Rise In The U.S.

Zombie Foreclosures On The Rise In The U.S.

During the quarter there were…

Trade In Counterfeit Goods Hits Half A Trillion Dollars

Trade In Counterfeit Goods Hits Half A Trillion Dollars

The counterfeit market has breached…

  1. Home
  2. Markets
  3. Other

Technical Targets for Gold, Silver and the Gold Stocks

The precious metals sector is at an important juncture. Let's take a look at the potential upside targets.

First lets start with Gold. Gold has formed a bullish cup and handle pattern, which is more bullish than usual due to the handle being formed at a higher level than usual. The pattern projects to $1450. Initial support is $1235-$1240 followed by $1225.

Note that volatility is low. This is bullish coming into a potential breakout as it means momentum can be added to the breakout in the form of rising volatility. Also, note the ratios at the bottom. Gold in real terms isn't as strong as it was and this bodes well for the more leveraged plays.

Gold

Silver of course is one of the leveraged plays on Gold. Silver has also formed a cup and handle pattern, which targets $24. Note the ratios at the bottom of the chart. Against foreign currencies, Silver has already broken to a new bull market high and Silver is breaking to the upside against Gold. As long as Silver holds above $18.50, one has to be bullish for the medium term.

Silver

Another leveraged play on Gold is the gold stocks. This chart shows the HUI index, which is testing resistance at 500 and eventually 520. A clean breakout to new highs and then we can focus on targets of 640 and 660.

Gold Bugs Index

Interestingly, the juniors have already broken out to a new high. The breakout projects to targets of $36.50 and $39.00. The juniors look a bit extended in the short-term, so it is advisable to wait for a pullback. A pullback below $32.00 would present an opportunity.

Market Vectors Junior Gold Miners

Certainly these technical targets look bullish but what about sentiment? Excessive bullish sentiment can mitigate what appear to be very positive technicals. Judging from the COTs and Sentimentrader.com's public opinion, there does not appear to be that excessive bullish sentiment.

As you can see below, public opinion on Gold is 68% bulls, which is not so enthusiastic relative to 2006 and 2008. 

Gold Bullish Sentiment

With Silver knocking on the door at $20/oz, the public is not yet fully on board. Public opinion is 64% bulls, which is low compared to 2006 and 2008.

Silver Sentiment

Remember that sentiment follows the trend most of the time. When a market breaks to the upside, there will be bullish sentiment. We just don't want to see excessive bullish sentiment as the market is breaking out. And we don't see that in the sector at the present time.

This analysis is only a small piece of what we do in our premium service. In recent weeks and in recent commentaries we've focused on Silver and the juniors. As you can see, these markets have already broken out, while Gold and the larger miners are the laggards. If you want to learn more about how to navigate and prosper from this bull market, then consider a free 14-day trial to our premium service

 

Back to homepage

Leave a comment

Leave a comment