• 364 days Will The ECB Continue To Hike Rates?
  • 365 days Forbes: Aramco Remains Largest Company In The Middle East
  • 366 days Caltech Scientists Succesfully Beam Back Solar Power From Space
  • 766 days Could Crypto Overtake Traditional Investment?
  • 771 days Americans Still Quitting Jobs At Record Pace
  • 773 days FinTech Startups Tapping VC Money for ‘Immigrant Banking’
  • 776 days Is The Dollar Too Strong?
  • 776 days Big Tech Disappoints Investors on Earnings Calls
  • 777 days Fear And Celebration On Twitter as Musk Takes The Reins
  • 779 days China Is Quietly Trying To Distance Itself From Russia
  • 779 days Tech and Internet Giants’ Earnings In Focus After Netflix’s Stinker
  • 783 days Crypto Investors Won Big In 2021
  • 783 days The ‘Metaverse’ Economy Could be Worth $13 Trillion By 2030
  • 784 days Food Prices Are Skyrocketing As Putin’s War Persists
  • 786 days Pentagon Resignations Illustrate Our ‘Commercial’ Defense Dilemma
  • 787 days US Banks Shrug off Nearly $15 Billion In Russian Write-Offs
  • 790 days Cannabis Stocks in Holding Pattern Despite Positive Momentum
  • 791 days Is Musk A Bastion Of Free Speech Or Will His Absolutist Stance Backfire?
  • 791 days Two ETFs That Could Hedge Against Extreme Market Volatility
  • 793 days Are NFTs About To Take Over Gaming?
What's Behind The Global EV Sales Slowdown?

What's Behind The Global EV Sales Slowdown?

An economic slowdown in many…

Billionaires Are Pushing Art To New Limits

Billionaires Are Pushing Art To New Limits

Welcome to Art Basel: The…

  1. Home
  2. Markets
  3. Other

Gold and Silver Ready to Rally?

Since my last reports on both gold and silver, price has come down to some key levels identified in those reports. So will both gold and silver turn up from here? Let's have a look at the charts and do our best to find out.

Now keeping in mind that my longer term view on both gold and silver is that they are currently in a consolidation phase within an overall bear trend with the final low still to come, most likely in 2015. This has been detailed in previous reports.

I'm always super wary when dealing with price that is in correction mode. Trading against the main trend is generally not to my liking. But let's give it a crack.

Gold and silver put in a nice rally recently with both topping out in July. From previous analysis, we have determined that a multi month rally is now underway. So this current pullback should bottom out and lead to the next rally which takes out the July highs.

On both charts I have added Fibonacci retracement levels of the recent run up combined with a Fibonacci Fan. Let's start with the gold chart.


Gold Daily Chart

Gold Daily Chart

In the green highlighted circle on this gold chart, we can see price came down a couple of days ago for a near direct hit on the 61.8% level. The low price was a whisker under US$1280. Interestingly, price is right in the zone of where this 61.8% level intersects with the 76.4% angle. I would be starting to get a bit of the heebie jeebies over the health of the multi month rally if price doesn't hold this area. If price is going to turn up, then there's no better place and time to start!

I have added both a Relative Strength Indicator (RSI) and Stochastic Indicator. The Stochastic has had a bullish crossover and is at a low level so a price rise wouldn't surprise there. The RSI is reasonably low and while nothing conclusive can be drawn from it, a price rise would also not surprise.

Let's move on to the silver chart.


Silver Daily Chart

Silver Daily Chart

Once again, we can see price has come down to the 61.8% level and also where that level meets the 76.4% angle. This can be seen in the green highlighted circle. So, just as with gold, here and now is the perfect area for silver to end the correction and resume the rally.

I've also added the same indicators as with gold. The RSI on the silver chart is showing an extremely negative reading. Much more so than on the gold chart. Surely a bounce at the minimum is just around the corner. The Stochastic is also at very low levels and while there is no bullish crossover yet, it is certainly threatening one.

Another difference between this chart and that of gold is silver looks to be bottoming now while gold is potentially putting in a higher low. A little bullish divergence perhaps?

So, it looks like it's do or die time for the multi month rally in gold and silver. I favour the "do" scenario.

 

Back to homepage

Leave a comment

Leave a comment