Sunday 29 April 2012

Primary down trend - remains intact

Despite continued bullish chatter across the web, neither Gold or Silver have broken out of their mid-term down trend. In fact with SLV breaking below $30 on Monday, this week was one of the weakest trading weeks for the precious metals in a few months.

GLD, weekly, 2yr

SLV, weekly, 2yr


From a MACD (blue bar histogram) perspective, both Gold and Silver are still seeing negative price momentum. There is nothing yet to suggest either metal is about to see a breakout to the upside.

Holding to mid-term bearish targets for Gold and Silver of $1200 and $21 respectively.

*an update on the monthly cycle will posted in a few days, once we've moved into May!

Thursday 26 April 2012

Gold...minor breakout to the upside

Gold rose around $14 today, and is now outside of the strong down channel that has lasted since the infamous $100 one day fall in late February.

GLD, daily

SLV, daily


Gold has clearly broken out of the 8 week down channel on the daily cycle. Silver may well make a similar move this Friday - so that's something to watch for.

However, the bigger trends are still down, only significantly higher prices would potentially change the mid-term down trend..See previous posts detailing weekly/monthly cycles for key levels.

Wednesday 25 April 2012

FOMC briefly upsets Gold & Silver

The FOMC lunchtime press release caused a brief strong sell off in both Gold and Silver. Once again, even on a day when the main market was up, the metals failed to participate.

SLV, daily

GLD, daily


Another day when Gold was stronger than Silver, and where Silver still closed lower - despite a latter day recovery. The broader trends remain downward, and I will cover my thoughts on what I believe are significant falls due within the next few months - this coming weekend.

Good wishes.

Monday 23 April 2012

SLV breaks under $30 support level

SLV broke and closed below what is the highly important $30 support level today.

SLV, daily

Today's close of $29.97 was off the intra-day low of 29.60, but I'd argue the damage has now been done. Todays candle IS a reversal candle, so that is also admittedly a possible bullish sign, but the primary trend IS down, and the $30 level has held up relentlessly since the rally earlier this year in mid January.

The next primary target would be a re-test of the recent 26 level. So we're looking at a good $4 to $5 decline (around 15%) in the weeks/months ahead.

GLD, daily

Once again, Gold was stronger than Silver and closed only marginally lower, although Gold itself is also still in a major down trend. The next target would be a re-test of the 150/148 zone.

Bearish equities and bearish metals

Considering that the main capital markets are showing weakness, and the dollar looks very much on the threshold of starting a new up wave that could last a number of months, the outlook for both precious metals still looks rather bleak. I would guess many of the gold bugs must be hoping the Bernanke will initiate QE3 within the next few months.

Sunday 22 April 2012

Fibonacci and the Shiny things

Whilst the main equity market looks set for at least a moderate down turn this week, lets consider the grand picture for the two primary precious metals, in terms of standard Fibonacci retracement.

Gold, 20yr, historic

Gold has broken the 10MA, and whilst the price is still pretty close to the peak, the trend is certainly a little weaker. The various indicators are bearish, at least in the near 3-6 month term, so the notion of $1400, even $1200 is very valid. A pull back to the 38.2 fib; would be easily acceptable, and that still doesn't mess up the long term up trend. I can only imagine the gold bugs fierce complaints across the various message boards if $1200 hits, and not realising that the primary trend is still intact.

Silver, 20yr, historic

Silver has of course already suffered a severe decline since last years peak of $49. Having already retraced to the 50% fib', that leaves the 61.8 around the $21.50 level. Only a break under $20 would seriously violate the long term trend.


Gold remains much stronger than Silver, and certainly also much more stable. Even a huge move lower in the metals this summer - or for even a longer period, would not violate the currently relentless upward trend.

Best guess - considering the wider macro-economic situation (I hold to a somewhat deflationary view - at least for another year or so), Gold to $1200, and Silver to $20

Despite the current weakness, relative to the equity indexes, both gold and silver have performed spectacularly across the last decade. You sure can't eat metals, but you sure can purchase a lot more with them - relative to just about everything else.

As many might agree...stack...and keep stacking.

Friday 20 April 2012

Gold/Silver - Lacklustre end to the week

A very quiet and moderately weak end to the week for the precious metals.

Just a quick look at the daily cycles

GLD, daily

SLV, daily

More over the weekend, with an update on the bigger monthly cycles.

Thursday 19 April 2012

Gold - black candle, a little warning?

They tried again to rally Gold, but it ended with another FAIL. The Metal maniacs must be really getting frustrated with this kind of regular failure. I'm sure many would blame JPM, but Gold has been very weak since that infamous $100 fall in February. It was a real market point for Gold, and the larger trends still suggest $1200 Gold later this year.

GLD, daily

Not much to add really, main trend continues to be slowly downward. Only a break above 163 would suggest something is changing.

*Silver looks much the same.

Wednesday 18 April 2012

Waiting for the Snap

Despite the massive online chatter about the long term prospects (and sound fundamental basis) for Gold and Silver, the mid-term outlook still appears to be that of a down trend.

SLV, 2yr, bearish outlook

GLD, 2yr, bearish outlook

Looking for a Snap

How much longer to wait for this touted snap lower? Well, the daily cycle is a baby bear everything is set up for a major wave lower at any point. The weekly cycles are also very much open to such a snap.

The monthly charts would just about allow the metals one further side ways month - during May, but the downtrend is suggesting a snap - if its coming.will be either beginning next week, or early part of May.

Is SLV about to see another Sunday night massacre - just like May'2011 ? Everything is in place for such a repeat performance.

Good wishes..from the Silver bunker.

Tuesday 17 April 2012

Metals again not participating in the rally

Whilst the Dow jumps over 1.5% today, once again the metals display their underlying weakness.

GLD, daily

SLV, daily

Indicators are warning of a renewed push lower, a push that could easily knock SLV below the big $30 level, and that indeed opens up a $4/5 cliff fall within a very short period of time.

If SLV breaks $30...its one to chase..with a short-stop at the $30 level.

Monday 16 April 2012

Silver - still in a baby bear flag

Silver is still weak, and is right on the edge of a $5 high cliff face.

SLV, daily

A move under $30 opens up a fast and furious move to re-test the 26/25 floor. Only a few consecutive closes above 32.50 would arguably take Silver out of the danger zone, and even then, we have the weekly and monthly charts which are still broadly trending lower.

For traders, we do at least have a very clear situation for stops..
Bears, higher than the 50 day MA at 32.25

As the physical world though...keep on stacking ;)

Sunday 15 April 2012

Weekly Cycles..still bearish

Gold and Silver remain bearish from a weekly perspective.

GLD, weekly, 2yr historic

From a MACD (blue bar histogram) cycle view, there is NO sign of a turn upward in the Gold market yet. We are still gently trending lower, we're under the important 10MA, and once again we are set to test the 1540/1500 level in the near term.  If Gold can't hold the 1500 level, then a move to 1400, if not 1200 would seem likely at some point later this year. Of course, that is assuming the more deflationary macro-economic viewpoint, and we know the Bernanke will be ready to fire another QE ICBM at any point.

SLV, weekly, 2yr

Silver is actually stronger than Gold in terms of its MACD cycle, but will very likely go negative cycle at the Monday open - unless we see a significant opening gap higher. Silver is dangerously close to the $30 level, and the daily cycle is a clear flag.

Arguably, considering the cycle, and continuing down trend, $30 looks more likely than not be broken under. Whether we have a wild and crazy collapse wave - as we've seen twice in the past 11 months, impossible to say of course. What is clear, there will sure be a lot of stops triggered if we break under $30. A mini-cascade is very probable if the big 30 fails to hold.


Coming soon...

Information for those looking to Buy Gold and Silver in the USA- including coins, bars, or investment funds. Also, regular updates on the precious metals markets, with charts and analysis.

The Ultimate Gold Bar? - 250kg