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

Another Retail Giant Bites The Dust

Forever 21 filed for Chapter…

Zombie Foreclosures On The Rise In The U.S.

Zombie Foreclosures On The Rise In The U.S.

During the quarter there were…

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

Breakouts Galore in Gold and Silver

Gold broke-out last week on Brexit while Silver waited a week to join the party. The miners, meanwhile cleared 2014 resistance today. There are breakouts across the board in the precious metals space.

The weekly candle charts of Gold and Silver are plotted in the image below. Gold appears to have digested the Brexit pop well as it gained another 1.5% on the week to $1339. If it holds above monthly and quarterly resistance ($1330s) then it should be on its way to $1380-$1400. Meanwhile, Silver surged 9.9% on the week to $19.59. It has broken out from an inverse head and shoulders pattern to nearly a 2-year high. The pattern projects to a target of $22.

Gold and Silver Weekly Charts

The breakouts in Gold and Silver were foretold by the strength and leadership from the mining stocks which closed the week with gusto. GDX surged 4.8% Friday and GDXJ surged 6.5%. Both closed near the highs of the day and broke 2014 resistance in clean fashion. GDX has upside to resistance at $30 and $32. GDXJ, which has more upside has resistance at $51 and $55.

VanEck Gold Miners and Junior Gold Miners Weekly Charts

We had been looking for weakness or at least some consolidation but yesterday realized that was becoming unlikely. The chart below is one we sent to premium subscribers in a flash update. The 2-hour bar chart shows that miners had formed a reverse head and shoulders continuation pattern which because of its upward slant indicated more strength than the typical pattern. The pattern projects to a target of ~$51 for GDXJ and $32 for GDX. Those targets are inline with the resistance targets above.

VanEck Gold Miners and Junior Gold Miners 2-Hour Charts

I am one of the biggest precious metals bulls but even I at times have underestimated the strength of this bull market (particularly in the miners). The miners correct less than I expect or do not correct at all. While it is tough to chase strength and stay bullish after a huge rebound we maintain our posture as we expect Gold to test $1400 and perhaps $1550 before a significant counter trend move. Buy weakness and hold. That is how to make money in a bull market.

 


Consider learning more about our premium service including our favorite junior miners which we expect to outperform in the second half of 2016.

 

Back to homepage

Leave a comment

Leave a comment