Gold & Silver: Falling Knives

Silver has failed to complete the second leg up as it couldn’t break above the August top of $15. It is interesting that this misbehavior of the white metal didn’t surprise you as the majority of you had bet last week that silver would fail and drop below $14.2. It’s impressive how accurate your forecast was!

In this post, I would like to update downside targets as we should be prepared for the resumption of the drop in metals after pullbacks have been finished.

Chart 1. Gold Weekly: Bear Flag Targets Bottom

falling knives
Chart courtesy of tradingview.com

Last week I reminded you of the big range of trade, which requires the retest of the downside of the range to complete the setup. Continue reading "Gold & Silver: Falling Knives"

Silver Slows Saving Gold From Collapse

Chart 1. Gold Daily: Former Support Retested, Another Spike Is Possible

pullback
Chart courtesy of tradingview.com

Gold has finally reached both the AB/CD target and the former support area of $1237 (gray dashed line) as it was forecasted last month in this chart. The metal hit the maximum of $1243 on the 26th of October and then dropped like a rock as was also anticipated after the completion of a pullback. Last Wednesday the price established a low of $1212 losing $31 (-2.5%) from the top. But at the end of last week, gold restored almost all of its losses, closing just below the former support at $1233.
Continue reading "Silver Slows Saving Gold From Collapse"

Copper On Big Time Frame Charts: $0.6 or $6?

There is an age-old question asking: How do you determine if a trader is biased? Show him a chart and ask where he thinks the market would go and then show him the same, but reversed chart and if the answer is the same, then this trader is indeed biased. We call such a trader a Perma-Bull or a Perma-Bear. The market sentiment is often split even as there are a lot of biased traders and market is then trapped within a range as there is no dominant opinion among the participants.

Every day I see how the trading community spreads opposite signals in any instrument creating an overwhelming sea of information where it’s hard for novice traders to focus and make a trading decision. Different levels of experience and fantasy generate the diversity of chart patterns and models. People change time frames and squeeze or expand charts; all of this affects the perception and therefore, the final decision.

Let’s perform an educational experiment with two patterns that I found on different time frames for the same instrument, copper. I will add two separate charts with those patterns followed by explanations. I am eager to see what you think about the outlook for this instrument after reading and voting on the pole at the end of the article. Continue reading "Copper On Big Time Frame Charts: $0.6 or $6?"

Gold & Silver: Fly or Die

The precious metals are busy finishing the anticipated pullback to the former support, which is almost within our grasp on the short-term charts. So, let it go and in the meantime we can look into the bigger charts with higher time frames to update the outlook beyond the short-term horizon.

Chart 1. Gold Monthly: 1122/1375

Gold Shines
Chart courtesy of tradingview.com

The monthly gold chart above answers some critical questions. The first one, why gold reversed ahead of $1000? The answer is the red horizontal line, which was set at the 2008 top and acted as strong support and breakdown of it would unleash severe volatility into the market as the next level of serious technical support is located in the $700 area (2006 top/2008 bottom). Continue reading "Gold & Silver: Fly or Die"

Gold & Silver: Get Ready For A Final Shot

Chart 1. Gold 4-Hour

LLLL
Chart courtesy of tradingview.com

Gold has already booked more than $20 from the low established on the 28th of September at the $1181. Now, there is no doubt that the pullback I mentioned in the middle of September has been in progress.

After hitting the $1209 area, gold halted its move to the upside and started a consolidation. I marked that move as the AB segment (up blue arrow). I always mention the tricky nature of corrective structures as it may vary on the fly. The shape of consolidation could be as a counter-trend zigzag, could fit into a rectangle or form a triangle. The latter has been shaped in our chart above as the combination of lower peaks and higher troughs. I highlighted it with the converging trendlines (orange). Continue reading "Gold & Silver: Get Ready For A Final Shot"