{"id":47904,"date":"2018-09-17T11:11:46","date_gmt":"2018-09-17T15:11:46","guid":{"rendered":"https:\/\/www.ino.com\/blog\/?p=47904"},"modified":"2018-09-17T11:11:46","modified_gmt":"2018-09-17T15:11:46","slug":"gold-struggles-silver-doesnt","status":"publish","type":"post","link":"https:\/\/wwwtest.ino.com\/blog\/2018\/09\/gold-struggles-silver-doesnt\/","title":{"rendered":"Gold Struggles While Silver Doesn't"},"content":{"rendered":"

In this post, I will take a deep dive into the chart structure of the precious metals as prices approach crucial triggers but on the opposite sides of each metal.<\/p>\n

Let\u2019s start with gold as it struggles to gain a foothold above $1200.<\/p>\n

Chart 1. Gold Daily: Pullback<\/h2>\n

\"Gold<\/a>
\nChart courtesy of tradingview.com<\/em><\/small><\/p>\n

The votes were split almost evenly in the poll in my earlier post<\/a><\/strong> about the gold\u2019s outlook. Half of the readers chose the trigger of the upside resistance at the $1218 and the rest thought that the market would drop to retest the $1122. The metal price then was just a little bit lower than these days at the $1186. <\/p>\n

Almost one month has passed since then, and to my surprise, none of the triggers were pulled although we were very close to the $1218 point, the market couldn\u2019t push above the $1214 at the end of the August and then retreated below $1200. This month we could see the increasing activity as investors are back from their summer holidays. There was another attempt to clear the resistance last week, but it stalled at the $1213 and the significant level again remained untouched. <\/p>\n

Despite two failures, short-term bulls are in a stronger position as gold hovers around the $1200 handle in the $1188-$1214 range. To retest the support, it should break below the multi-year low established in the middle of the August at the $1160, which is further from the current level than the upside trigger.<\/p>\n

I think the metal is in a classic pullback move these days, which follows the breakdown of the orange support (built on the weekly time frame). I added two blue arrows to highlight the whole expected retracement. The first AB segment gained $54 from the low. Now the market is in a sideways consolidation (two thin red arrows), which would link the B and C points before the CD segment unfolds to touch the orange line. The latter should be larger than the AB segment as the distance to the broken support is pretty long. The touching point is around the $1260 and the expected starting point for the CD segment is around the $1180 level.<\/p>\n

So, as the chart structure emerges I think we will clear the $1218 trigger, but the pullback will be just a pullback, and the metal should drop again. The Fed is believed to hike interest rate higher, and this would impose more pressure onto the metal. I will show my outlook for the interest rate in one of the upcoming posts.<\/p>\n

A break above the $1309 (earlier consolidation\u2019s top) would invalidate the bearish midterm structure. If the metal couldn\u2019t build the second leg of the pullback to the upside, and there is such a probability if you would look into the silver chart below, then watch $1160 to be triggered.<\/p>\n

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What do you think about gold?<\/strong><\/p>