Spot Chart | Gold and Silver Price Getting Set To Explode Higher :: The Market ... | News2Gold

Spot Chart | <b>Gold</b> and Silver Price Getting Set To Explode Higher :: The Market <b>...</b> | News2Gold

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• <b>Gold</b> and Silver Price Getting Set To Explode Higher :: The Market <b>...</b>
• Is This A <b>Gold</b> And Silver Bear Market Or A Correction In A Secular <b>...</b>
• <b>Gold</b> Breaks Down Below The July Lows | <b>Gold</b> Silver Worlds

<b>Gold</b> and Silver Price Getting Set To Explode Higher :: The Market <b>...</b> Posted: 22 Aug 2014 09:13 AM PDT Commodities / Gold and Silver 2014 Aug 22, 2014 - 04:43 PM GMT By: Austin_Galt Can you feel it? That air of desperation creeping into the mindset of the gold and silver bulls. It seems like only yesterday that the bulls were hooting and hollering and calling the next great bull market underway. Calls of "$2000 gold here we come", "$100 silver here we come". Yeehaaaa!!! Them were the days. And I suspect those days are nearly upon us again. And these same calls will be ripped out once more. However, before that party gets started, a low is needed to end their respective pullbacks. Let's see where things stand beginning with gold. Gold Daily Chart Previously, I thought gold was safe after breaking a previous swing high. Personally, I like to differentiate previous swing highs labelling some major swing highs and others minor swing highs. In this case, the minor swing high is shown in the green highlighted circle while the major swing high is shown in the yellow highlighted circle. We can see the recent high, shown in the red highlighted circle, took out the minor swing high but failed to go on with the job by taking out the major swing high. I have added a Parabolic Stop and Reverse (PSAR) indicator where we can see price broke support recently as seen by the dots to the downside being busted. Those dots stood at US$1292 before being taken out. This was also around the level of PSAR support on the weekly chart as shown in the last report. This was a key signal for bulls to cut long positions. Price has now headed to new pullback lows and I have added Fibonacci retracement levels to try and determine where the pullback may eventually end. The next level is the 76.4% level at US$1264. However, considering my view that this current action is all part of a major consolidation before price heads to new lows, I won't rule out a move to the 88.6% level at US$1252. Price action within corrective patterns can be quite tricky. I have added a Relative Strength Indicator (RSI) and Stochastic indicator and both can be seen trending down but at oversold levels. So, one might surmise that the low is just around the corner. Finally, I have added trend lines to denote an uptrend channel and a downtrend channel. The thing that stands out to me is the impulsiveness of the trading in the uptrend channel compared to the corrective nature of trading in the downtrend channel. That is yet more evidence that price is in a little bull trend and a strong move up is surely just about upon us. Now, let's look at the monthly chart to refresh ourselves of the bigger picture. Gold Monthly Chart I have added a RSI which shows a pattern of higher highs and higher lows indicating strength is building. I have also added a Stochastic indicator which shows a bullish crossover recently and is now trending up indicating overall bullishness. And finally, I have added a Moving Average Convergence Divergence (MACD) indicator which also shows a bullish crossover recently and is indicating the probability of higher prices going forward with the blue line above the redline. So, things appear pretty rosy for the bullish case. That may ease some nerves being exhibited by the bulls. All that is required now is for the daily chart to get in line with the monthly and then a decent rally higher can be expected. And once that happens, I expect price to bust the upside resistance from the PSAR indicator as denoted by the dots. That would relieve some of the overall negativity. Those dots currently stand at US$1354. Let's now move on to silver. Silver Daily Chart The RSI shows a little bullish divergence so a low looks close at hand. The MACD indicator is still bearish and trending down but it is at extremely low levels so a sharp rally would not surprise here. But first we need a low. Where? I have added Fibonacci retracement levels of the leg up from the May low to recent July high. I must admit, I didn't think price would go as low as the 76.4% level. But that is exactly where it hit today. That may be it. I'm looking to get involved on the long side here but I just couldn't do it today. Something just doesn't feel right. I took some small long positions but when the reversal didn't eventuate today I closed them out. Price may see a wash out down close to the 88.6% level at US$18.95 before the belated reversal higher begins. I'm watching keenly! And as I did with the gold chart, I have also outlined the uptrend and downtrend channels. While not as apparent as the gold chart, price does look more impulsive in the uptrend channel and more corrective in the downtrend channel. Let's reacquaint ourselves of the big picture by looking at the monthly chart. Silver Monthly Chart As with gold, the RSI on the silver monthly chart shows a pattern of higher highs and higher lows indicating strength is building. The Stochastic indicator is also indicating bullishness by trending up. And the MACD, while being at low levels, is also trending up and indicating higher prices are likely with the blue line above the red line. And with all this evidence of bullishness, price is still only around US$19.50! That probably means something drastic is set to happen. I have added a PSAR indicator which shows the dots to the upside being busted last month. Now it's time for the silver price to go on with the job. I remain extremely confident that a large rally is set to occur any day now that will see both gold and silver bust their respective July highs. The coming low may see a spike down before a sharp reversal higher and may prove hard to catch. I suspect one will have to be nimble. And by the way, I do believe we will see US$2000 gold and US$50 silver and much higher in the future. Just not yet. Bio I have studied charts for over 20 years and currently am a private trader. Several years ago I worked as a licensed advisor with a well known Australian stock broker. While there was an abundance of fundamental analysts there seemed to be a dearth of technical analysts, at least ones that had a reasonable idea of things. So my aim here is to provide my view of technical analysis that is both intriguing and misunderstood by many. I like to refer to it as the black magic of stock market analysis. Please register your interest in my website coming soon. Any questions or suggestions, please contact austingalt@hotmail.com © 2014 Copyright  Austin Galt - All Rights Reserved Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. © 2005-2014 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication. Only logged in users are allowed to post comments. Register/ Log in

Is This A <b>Gold</b> And Silver Bear Market Or A Correction In A Secular <b>...</b> Posted: 23 Aug 2014 10:46 AM PDT Does the following contrast sound familiar to you? Mainstream media headlines, mostly based on either mainstream economists or large financial institutions, report continuously how weak the precious metals market is; they hasten to remember readers how the bull market had burst in 2011 and that much lower prices are just around the corner. In their view, after peaking in 2011, gold and silver are in a clear bear market. On the other hand, writers and analysts that are non-mainstream (most of them non-Keynesian) consider today's gold and silver market as a long correction in a gigantic secular uptrend; they expect (much) higher prices in the years to come. The interesting thing is that everyone is looking at the same data and charts. The key question is whether the gold market is correcting in a secular trend or the bear market is here to stay (till the next cycle starts). In order to answer that question, the team at ShortSideOfLong did an excellent job comparing the ongoing correction in gold and silver with previous corrections. Based on purely chart observations it seems feasible (with a high probability) to come to a reliable answer. One should note that the data in the following two charts come from the period after 1971, as that was the year when gold started to trade in a "free market" (after US President Nixon closed the gold window on August 16th 1971). The first chart shows different gold bear markets since 1971. The conclusions from the chart come from the analysts at ShortSideOfLong: Observation 1 is related to the steepness of the correction: Precious metals bears who claim that Gold was a bubble in 2011 with similarities to 1980 are most likely mistaken. When real bubbles burst, they sell off rather rapidly by falling in similar fashion to the way they risen, generating amazing losses. When the Gold bubble burst in 1980, the price sold of by 66% (two thirds) in the pace of 18 months. The recent sell off was only one third at its worst point; this clearly is not the bursting of a bubble. Observation 2 is related to the length of the correction: The current bear market has so far been the third longest in time. The longest bear market for Gold started from the peak just before 1988 and lasted for 5 long years, all the way to the beginning of 1993. Assuming we follow a similar pattern, Gold would move sideways until October 2016. If this was to be the case, those who purchased Gold would not experience a large downside risk, however there capital would be trapped in a nonperforming asset. This is commonly known as a value trap. Observation 3 is related to the correlation with previous corrections: The closest correlation the current downtrend has with previous ones, is the 1996 to 1999 bear market drawn in yellow. The initial sell off lasted about two years, at which point a long consolidation started. Both bulls and bears became frustrated at the lack of a trend, similar to what has been happening as of late. While the Gold bulls claimed that it was a basing pattern at the time, the price actually collapsed one last time into a final low before a bull market took off. Gold bear market is turning three years old in early September Related to Silver, the team at ShortSideOfLong came up with similar observations: Observation 1 is related to the steepness of the correction: Since Silver peaked around a similar price point in both 1980 and 2011, precious metal bears were once again predicting a 1980s style bust and total wipe out. After peaking at $50 in early 1980, Silver fell to $5 per ounce (90% decline) in a space of just over two years. However, as the analogue clearly shows, the current bear market isn't anything like the 1980-82 bubble crash. It is actually correlating more with 1983-86 and 1987-91 downtrends in both time and price drawdowns. Observation 2 is related to the steepness of the correction: Silver bear market is currently almost 3 years and 4 months old. By historical precedent, this is one of the longest bear markets since Silver started trading in late 1960s. We have just taken over the 1983-86 downtrend and in a month this bear market will also be longer then the 1968-71. In theory, if Silver does make a lower low, we are now only months away from setting a new record. Already we are given a hint that the downtrend is exhausted, so a lower low well into 2015 would be a true historical anomaly and most likely a terrific buying opportunity. Observation 3 is related to the correlation of previous corrections: Each one of the final bottoms produced some kind of an extraordinary gain. After bottoming out in 1971, Silver shot up by more then 450%. As the 1974-76 downtrend ended, Silver managed an amazing performance of 1200% or 12-fold over the next 4 years. This was the end of a secular bull market. The huge bust in 1982 eventually saw the metal triple from the lows. The 1986 bottom saw gains of 100% within the following 12 months. The 1991 bottom was the most disappointing of all even though it was the lowest low, as Silver spent majority of the time moving sideways. Gains of 100% only showed up seven year years later in 1998, as Buffett was reportedly buying the metal. Silver's bottom in 2001 produced gains of over 500% in the years after, while the Global Financial Crisis bottom of 2008 produced another 550% plus rally in less then three years. Even without counting the speculator gain in late 1970s, Silver averaged around 350% gain after every bear market. As we can see, buying Silver at the bottom is incredibly difficult task, but has amazingly lucrative gains for those who have the skill and luck to execute it. Silver has now been in a bear market for 3 years and 4 months! A concluding note from analyst from Tiho Brkan Guessing isn't very useful when it comes to investing, but if I had to make a guess I would say that both metals sell off one final time into a lower low by early 2015. Based on historical analogues alone, Gold seems to be following the 1996-99 bear market quite well and could bottom around March 2015. At the same time if Silver falls to a lower low around March 2015, that would be one of the longest and most oversold downtrends (not including the 1980-82 bubble crash).

<b>Gold</b> Breaks Down Below The July Lows | <b>Gold</b> Silver Worlds Posted: 22 Aug 2014 09:02 AM PDT This is an excerpt from the daily StockCharts.com newsletter to premium subscribers, which offers daily a detailed market analysis (recommended service). Gold breaks to two-month lows in Thursday's trade on the first chart. We have a major horizontal support and resistance area on the gold chart shown in red. Gold pulled down to test that support level. It is also the uptrend support line. This is a very important place for gold to hold, especially with the strength of the USD. Gold is still up $60 from the start of the year. Based on the USD strength and the positive correlation of Gold to the Swiss Franc, there are a few clues that should line up if $GOLD is about to turn to the upside here. One being dollar weakness or at least strength in the Swiss currency in sympathy with Gold, the next being a similar turn higher in silver and we would like to see the gold stocks start to outperform the metal again. Silver also pulled back today on the chart below. The price movement in Silver looks very contained with a continual drip lower and it did not have the big thrust down like Gold did today. While Silver is also at 2 month lows, it was a slow drip for Silver and a sudden thrust for Gold. Silver is in an area of horizontal support for the next $0.75 down.

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