The daily chart of gold shows a retreat in the price to the 1st support level, which should hold if this is going to be a relatively easy pullback/correction. This morning’s candle stabbed through it, tested the EMA 20 and hammered back to support.
But let’s also be aware of the SMA 50 floundering down at 1688 with the next visible support in the 1670 to 1690 range.
Weekly gold shows the wedge that the price broke out from after a false breakdown below support. 1800 to 1810 is the objective to take out now if seasonal relief is going to continue for gold. As a side note, the false breakdown did tick gold to a test of its 50% Fib retrace in the 1628 area. But speaking purely technically here, gold needs to take out 1807-1810 to start minimizing the potential that the two previous highs above 2000 may be a double top. Negating the breakdown below support and taking out 1735 were steps 1 and 2 for that process.
Silver is holding above important support that would keep this a comfortable pullback if it holds. It is lurking and eyeballing the downtrending SMA 200, which it took out and dropped below last week.
The weekly chart of silver continues to show that a major support area was tested, thus far successfully. What’s more, silver was always going to stop at the 22 area, which is the battle ground it’s been dealing with this year. With the daily SMA 200 above near this region and in play, a takeout of 22.57 resistance would be very meaningful and could set in motion a solid bull cycle.
But as yet, it has done no such thing. So let’s keep the pompoms at bay until/unless silver, which has been trying to lead a precious metals party, breaks through.