Gold & Silver: The King Reins In

Almost all targets, which were set in the previous post, were reached last week except for the gold. I think the central banks bought the dip of the gold price, as the silver was lack of such strong support.

The majority of readers guessed it right as the US dollar index (DXY), aka “The King,” exceeded the target and reached the trendline resistance that I have mentioned at the beginning of the month. It is time for updates, and “The King” will open the series of charts.

The DXY daily chart is the first.

Gold Silver

It is interesting to see how from time to time, the market catches traders in a “make it or break it” situation right at the end of the trading week, keeping their heads spinning with almost paranoiac thoughts – “I should keep the profitable position Vs. I should book the profit”. It is even worse this time as usually Friday is the “book the profit and relax” day, but the price just stalled on the trendline resistance; hence not much of the selling to cover was there. Continue reading "Gold & Silver: The King Reins In"

Gold & Silver: Too Good To Be True?

The prices of gold and silver remained between triggers last week as volatility left the market, and the “pulse” on the chart is hardly beating. It is time to challenge our bullish view, as it could be “too good to be true.”

Let us imagine if the market is building a more complex correction and another downward move is underway. I put that scenario in the alternative charts for gold and silver below. Before we jump in precious metals, I would like to share with you an updated US dollar index (DXY) 4-hour chart.

dollar

The DXY goes very well with my expectations as the outlined structure keeps intact, and we got a larger consolidation here with a second leg down underway. It could dip even lower to retest the former resistance again in 92.4 area. That will cut the target for the pending CD segment either to 94.5 from the earlier aim of 94.6. Continue reading "Gold & Silver: Too Good To Be True?"

What's Next For The Dollar, Gold And Silver?

We have an interesting situation in the market as the strength of inversely correlated instrument didn’t push the other asset price down. Such things happen, and I showed you in the past that the correlation itself is not a dogma. The market flows are driven by investors’ sentiment, which in turn is based on subjective judging.

Let’s see the updated charts below, and the US dollar index (DXY) will be the first.

Dollar

The votes under my previous post about the next move for DXY were split evenly between “break up” and “another drop” options. It’s quite a natural outcome as we never know for sure if a breakout would happen or not. The extreme bullish divergence on the daily RSI finally enforced the price to break up the red resistance. Continue reading "What's Next For The Dollar, Gold And Silver?"

Dollar Index, Gold And Silver Updates

The summer sure has flown by. It was full of events, and we got a new all-time high gold price then. The fall should be an interesting season, as well as “The Volcano Awoke” for precious metals and more “eruptions” are expected ahead.

I updated the charts for you below, and the US dollar index (DXY) daily chart will open this post.

Precious Metals

The majority of readers voted earlier that the dollar index will reach the upside of the red trend channel. The second most popular choice that DXY will not exceed the former top of 94 and continue down (Extremely Bearish) paid well as price indeed couldn’t overcome that barrier and dropped again. Then there was another attempt, and another drop as the chart structure has shown seesaw moves within a black channel. It affected the precious metals price as they have been trapped in the sideways zigzags as well. Continue reading "Dollar Index, Gold And Silver Updates"

Precious Metals: Where Do They Go From Here?

When I see such situations in the market as we witnessed in precious metals lately, I think about two trading mantras. The first one says, “any profit is a profit,” aka “lose chances, not money,” and the second is “corrections are tricky.”

Both metals’ charts started to play out precisely as per the structure that was shown in my previous update, and I am very grateful as you supported my view with an overwhelming majority of voters. Indeed, it paid well, although the depth of the first leg down was just devastating as it exceeded the preset range.

Usually, the first legs are so strong and sudden as they trigger panic in the market. Although I expected this move weeks ahead, when it plays out, you’re never emotionally ready for such a storm as it literally could have no boundaries. The fear had it all. Some traders think they could sit through such enormous volatility. I doubt that risk management/capital/margin could allow it as gold lost more than 10% from the top to the bottom of the first leg while silver has been smashed, losing 22%.

The dust is quietly settling down after that fall, and we can adjust the plan. Let’s start with gold’s daily chart.

Precious Metals
Chart courtesy of tradingview.com

Again and again, we witness the real power of the trends as the “falling knife” of the first leg down was successfully rejected with the downside of the trend channel (gray). The price bounced off so hard that it retraced more than 60 percent of the preceding drop. Then it lost more than 60 percent again, but of the rise. If it continues to make such seesaw moves within a contracting range, then we will see a Triangle pattern shaping on the chart. I highlighted that option with a green color. I put two converging trendlines with almost ideal angles of a triangle, but the real path could differ, although the model should remain intact. The break above the last peak will trigger the upside move. Continue reading "Precious Metals: Where Do They Go From Here?"