{"id":30512,"date":"2014-12-06T07:00:59","date_gmt":"2014-12-06T12:00:59","guid":{"rendered":"http:\/\/www.ino.com\/blog\/?p=30512"},"modified":"2014-12-30T15:21:33","modified_gmt":"2014-12-30T20:21:33","slug":"will-silver-drop-to-4-5oz","status":"publish","type":"post","link":"https:\/\/wwwtest.ino.com\/blog\/2014\/12\/will-silver-drop-to-4-5oz\/","title":{"rendered":"Will Silver Drop To $4-5\/oz?"},"content":{"rendered":"

\"Aibek<\/a>
\n
<\/p>\n

Gold Chart Analysis<\/h2>\n

On a monthly chart of gold (FOREX_XAUUSDO), the 6 year cycle has entered the final period after the price peaked in 2011 at $1823 close. A descending continuation triangle pattern has been formed. This suggests that the price will proceed in a downward movement.<\/p>\n

This line chart shows monthly market closes and it clearly indicates that the triangle's base was broken at the $1180-$1205 level. The price, already for two consecutive months, managed to close below first support. This signal confirms the pattern. <\/p>\n

The target is calculated as the distance of the trend before the Triangle was formed, from the peak in August 2012 close at $1764\/oz to the low of May 2013 close at $1243\/oz, and projected below the triangle's base. I calculated $700\/oz level as the target for our move with simple approximation, which coincides with the 6 year cycle's start or base level. This gives more weight to the power of this level. <\/p>\n

There is very tough support between $1200 and $700 levels located at $1000\/oz. Firstly, it's an important psychological level and secondly, it is a former stiff resistance which was broken only from a 4th attempt in 2009. Only this level can be a serious obstacle on the way down.<\/p>\n

Although we see a clear bearish trend, we can't rule out a pattern breakout or total reversal of the trend. <\/p>\n

On the upside, the first good resistance is at the $1300 level which is the triangle's upper side, the second good resistance is $1400 \u2013 the triangle's first peak. <\/p>\n

\"Gold<\/p>\n


<\/p>\n

Silver Chart Analysis<\/h2>\n

Let's move onto silver (FOREX_XAGUSDO). Like the previous chart of gold, we see a 6 year fading cycle, but the curve is steeper for silver. And of course, you can see that silver dropped far deeper than the gold. If gold dropped around 40% from it's all time high in 2011, then silver plummeted an impressive 70%! Since silver is less liquid, that would explain its volatility. Silver's price action is a good indicator for gold's future moves. Keep that in mind while you search for trading opportunities. <\/p>\n

This metal broke all major supports, including the very important level at $20\/oz, which is a former resistance level that couldn't be broken for 3 years in a row. Next was the triangle's base at $19\/oz. After it was passed, the price quickly fell to new lows at $15\/oz. The target was calculated in the same manner as it was calculated for gold, at $4-5\/oz to the downside. I would be very cautious once the price reaches $10\/oz. Anywhere a two-digit number turns into a one-digit number is an area of prime psychological importance.<\/p>\n

\u2028Price can start to be volatile between the $10 and $20 levels, which then acts as resistance for a possible price pullback.<\/p>\n

After $20, the next good resistance is located at the $24-$35 level, which is the peak of the triangle.<\/p>\n

\"Silver<\/p>\n


<\/p>\n

Visit back for my metals analysis next week. <\/p>\n

Lucky trades,<\/p>\n

Aibek Burabayev<\/a>
\nINO.com Contributor, Metals<\/p>\n

Disclosure: This contributor has no positions in any stocks mentioned in this article. This article is the opinion of the contributor themselves. The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. This contributor is not receiving compensation (other than from INO.com) for their opinion.<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"

Gold Chart Analysis On a monthly chart of gold (FOREX_XAUUSDO), the 6 year cycle has entered the final period after the price peaked in 2011 at $1823 close. A descending continuation triangle pattern has been formed. This suggests that the price will proceed in a downward movement. This line chart shows monthly market closes and […]<\/p>\n","protected":false},"author":21,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[6920],"tags":[6922,2567,6921],"class_list":["post-30512","post","type-post","status-publish","format-standard","hentry","category-ino-com-contributors","tag-aibek-burabayev","tag-gold-analysis","tag-gold-contributor"],"yoast_head":"\nWill Silver Drop To $4-5\/oz? - INO.com Trader's Blog<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.ino.com\/blog\/2014\/12\/will-silver-drop-to-4-5oz\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Will Silver Drop To $4-5\/oz? - INO.com Trader's Blog\" \/>\n<meta property=\"og:description\" content=\"Gold Chart Analysis On a monthly chart of gold (FOREX_XAUUSDO), the 6 year cycle has entered the final period after the price peaked in 2011 at $1823 close. 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