A simple look at the pre-market futures charts of gold and silver and HUI’s status at yesterday’s close.

Gold is thus far holding to the ‘retest of the lows’ and a short-term double bottom scenario. We also allowed for a drop to the lower channel line but for now gold has its eyes on the resistance area that coincides with the down trending SMA 50. It’s obviously still in a downtrend and ongoing correction, technically. On the other hand, the correction’s end would have to start somewhere.

Bottom Line: Trending down, bouncing toward important resistance.

Silver took back the SMA 200 and tentative support. The major trend is still up. If it can continue to follow through it would start to undo the H&S/double top scenario. A trend is a trend as long as it is in place after all, and the SMA 200’s trend is up with the silver price just a hair above it. The thick long-term resistance zone coincides with the SMA 50. That’s an important area.

Bottom Line: Silver is bouncing a bit, trying to undo its breakdown. The trends are tentatively intact and they are up. The first key juncture would be the SMA 50 and the right shoulder in the 26.30 area. Take those out and the bullish view would improve. If it fails at the SMA 200 again there would be significant downside potential. Silver must hold the SMA 200.

HUI continues in the interesting short-term pattern as it tries to turn resistance #2 to support and nests on top of the SMA 50. It will be important for HUI to hold this level. That would not get it out of correctional jail, but it would keep it in play for a try at the channel top at least. Interestingly, the little pattern measures to around 305 and the area where HUI would really have a battle on its hands to break the downtrend. Meanwhile, on Huey bounces.

Bottom Line: Downtrend intact and positive strides still being taken. A bounce to 305 could be doable and there would be the big decision point whether or not the correction will be technically ended.