Silver (daily chart) is making a classic pullback to test the breakout after becoming overbought. Silver does not do things gently. Nor does the precious metals complex as a whole. A reasonable expectation is for a test of the junction area of the black dotted neckline and the rising SMA 50. At that point silver would not only have shed its overbought status, but would start to look oversold.
Here is the wider angle view, dating back to 2020. It’s a bull pattern that was activated with the shot through the neckline, and silver is bullish until proven otherwise. Anything can happen because TA is just a probabilities tool not a be all, end all. But respecting the TA, silver is dropping toward a buying opportunity according to classic breakout and retest TA.
Gold is also coming hard off of its overbought situation and I would look for the hard rising SMA 50 and then the green shaded zone as two candidates to halt the pullback.
Gold is in blue sky and would be so even if the upper bound of major support in the 2034 to 2076 range is tested, which I don’t think is likely, but depending on the macro, is possible. Even if it were to test the rising SMA 200, gold is just plain bullish, technically. It just would not feel that way to momos and hangers on if the pullback cuts deep.
Bottom Line
Watch the 25.50 to 26.00 zone on silver, with an awareness that when the momo gets going (in both directions), it really goes. So a stab lower is not out of the question but silver has already dropped its bullish breadcrumbs above, as a way to find its way back later.
Watch the 2175 to 2220 zone on gold.
Agreed. Long miners from near the bottom in Feb. Have been thinking we might go slightly higher high first in miners on the next retracement in metals then a bigger correction. Seeing a possible final rally in some of the junior charts also but they can flip on a dime.
Thanks for the update and keep up the good work. Rely on your analysis for when sentiment is getting a little too bullish in this sector!
A final rally would go well with the targets for GDX/HUI. The way I am leaning is that the sector finishes correcting here with the market, rallies hard to GDX 40 (ish) and then drops when the broad market flames out for good. Later, probably in late 2024 or H1 2025 comes a real buy for a real bull. That’s the sketch, anyway.
BTW, I tried accessing this update from my phone a while ago, as I was out. The password did not open the post. But I could access other posts and NFTRH 807. Then I refreshed the page of this post and it opened. A strange but minor little gremlin in the works.