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Tuesday, January 5, 2016

Gold and Silver charts: desperately seeking strong floors

Gold chart pattern



The daily bar chart pattern of gold is trying to find a floor to its relentless fall. The zone between 1040 and 1060 has provided good support during Dec '15 - raising bullish hopes.

Not much should be made of the high volume jump to test resistance from the falling 50 day EMA on Jan 4. That appears to be a knee-jerk reaction to the sharp fall in global stock markets.

China's economy continues to slow down. A Shia-Sunni tussle is brewing in the Middle East. Neither news should have come as a big surprise to gold traders.

Daily technical indicators are showing some bullish signs. MACD has been rising above its signal line for the past month, but remains in negative zone. RSI and Slow stochastic are in neutral zones. 

On longer term weekly chart (not shown), gold’s price is trading well below its three falling weekly EMAs in a long-term bear market. Weekly technical indicators are in bearish zones and moving sideways.

Silver chart pattern



The daily bar chart pattern of silver touched multiple bottoms in the price band between 13.60 and 13.80 during Dec '15, raising bullish hopes of a recovery in price.

That is unlikely to happen anytime soon. The falling 50 day EMA is proving to be an insurmountable resistance. 

Despite a sharp intraday rise with strong volumes on Jan 4, silver's price closed well below its three daily EMAs in a bear market.

Daily technical indicators are in bearish zones, and not showing any signs of upward momentum.

On longer term weekly chart (not shown), silver’s price is trading well below its three weekly EMA in a long-term bear market. Weekly technical indicators are in bearish zones, and moving sideways.

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