Tuesday 31 May 2016

A month of cooling

The precious metals of Gold and Silver saw a very broad - and significant, month of cooling, with net declines of -$77.40 (6.0%) @ $1217.50 (intra high 1306.00), and -$1.90 (10.6%) @ $15.99 (intra high 18.06). Mid term outlook remains bullish, as the breakout levels remain intact.

Gold, monthly

Silver, monthly


After four consecutive months of gains, it was not entirely surprising to see the precious metals see some cooling.

The fact the USD climbed across May added to the downward pressure on the precious metals.

With renewed confidence in the capital markets, both Gold and Silver have lost a great deal of the 'fear bid', that both had accumulated since the Dec' 2015 lows.

My outlook is that the precious metals will capture a renewed fear bid - on capital market upset this summer, and lasting into the autumn.

A key issue is that equities should remain under the summer 2015 highs. If however, the sp'500 can break above 2134, it would bode very badly for Gold and Silver... and by default... the related mining stocks.

So... for the gold bugs out there.... keep an eye on the equity market!

Friday 27 May 2016

Four weeks down

With the USD continuing to climb, and increased confidence in the broader capital markets, the precious metals continued to cool, with Gold and Silver seeing net weekly declines of -3.4% and -1.9% respectively. Core support is fast approaching

GLD, weekly

SLV, weekly


Suffice to add, after a powerful ramp - and multi-year breakout - from the Dec' 2015 low, the precious metals are really struggling as the USD climbs on renewed mainstream belief of a second rate hike in June/July. The broader confidence in capital markets is also stripping Gold/Silver of their fear bid.

GLD needs to hold the $112s.. where there are a number of aspects of support.

SLV needs to hold >$14.50.

If GLD 111s, with SLV in the low 14s, then it'll be a major problem, and provisionally negate the breakout from earlier this year.

If sp'500 breaks a new historic high >2134, then it would be suggestive of a CORE TREND change... with equities to climb for the rest of the year... with the metals eventually breaking new multi-year lows.

The next 3-5 weeks of price action will be critical.

Friday 20 May 2016

A third week of cooling

The precious metals of Gold and Silver cooled for a third consecutive week, with net weekly declines of -1.7% and -3.6% respectively. A third week higher for the USD is putting some added downward pressure on the metals. Broadly though, the mid term trend remains strongly bullish.

GLD, weekly

SLV, weekly


It is highly notable that the USD saw the third consecutive weekly gain... having climbed from the DXY 91s to the 95s. This is unquestionably putting some downward pressure on Gold and Silver.. both of which have seen very significant gains since the Dec'2015 lows.

Core support - across June/July

GLD - the 114/112 zone.

SLV - 15.00/14.50 zone.

Unless spot Gold breaks back under $1170 (GLD 112), the original breakout from February is intact.

Best guess... regardless of any near term chop/weakness, Gold looks set for the $1300s this summer... and that will open the door to a surge to the 1400/1500s.

The precious metals arguably remain an indirect signal of underlying capital market unrest.

Friday 13 May 2016

A second week of cooling

It was a second (and natural) week of cooling for the precious metals, with Gold and Silver seeing net weekly declines of -1.2% and -2.2% respectively. Despite the ongoing weakness, the metals are performing very well, not least as the USD has climbed for 8 of the past 9 trading days.

GLD, weekly

SLV, weekly


Nothing has changed in the mid term outlook.

Gold still looks set for the $1400/1500s.

If correct, the related mining stocks will climb a further 40/50% (having already doubled since the January low).. with the ETF of GDX seemingly headed for the $35/40 zone.

Friday 6 May 2016

A cooling week for the metals

After a broad climb across the past month, the precious metals saw a week of cooling, with Gold and Silver seeing net declines of -0.4% and -2.1% respectively. Near term outlook remains bullish, with Gold set to break above the $1300 threshold, and Silver into the $18s.

GLD, weekly

SLV, weekly


Suffice to add... after 4 weeks up (broadly), a week or two lower is entirely natural, and does nothing to dent the massive breakout that was achieved in Jan/Feb'.

Gold looks set for the $1300s in the near term... with the 1400/1500s seemingly equally probable this summer/early autumn.

If correct, it bodes for continued hyper strength in the related mining stocks, which would likely equate to the miner ETF of GDX trading to the $35/40 zone.