In the previous post, bearish technical patterns, e.g. a 'shooting star' candlestick and negative divergences visible on the daily chart pattern of Gold had led to the following remarks:
"A pullback towards the top of the 'symmetrical triangle' is quite likely. The dip will provide a lower entry point."
Gold's price pulled back to the 1260 level, but received good support from its 20 day EMA and bounced up to touch an intra-day high of 1290 on Mon. May 16. However, it closed lower at 1275 - forming another bearish 'shooting star' candlestick pattern.
Daily technical indicators are in bullish zones, but not showing any upward momentum. MACD is sliding below its signal line in positive zone. RSI is moving sideways above its 50% level. Slow stochastic is slipping down towards its 50% level.
Some more correction or consolidation is possible. Any dips can be used to enter. Why? Because, all three EMAs are rising and gold's price is trading above them in a bull market.
On longer term weekly chart (not shown), gold’s price pulled back to its 200 week EMA as expected, before bouncing up. Weekly technical indicators are correcting overbought conditions. Another test of support from the 200 week EMA is likely.
Silver chart pattern
A 'reversal day' bar formed on May 2 and overbought technical indicators had hinted at a correction in the previous post on the daily bar chart pattern of Silver.
Silver's price corrected below its 20 day EMA and touched an intra-day low of 16.80 on Fri. May 13 before bouncing up to close just above 17.
Daily technical indicators are giving mixed signals. MACD is falling below its signal line in positive zone. RSI is looking mildly bullish by staying above its 50% level. Slow stochastic has dropped to the edge of its oversold zone.
Expect some more correction or consolidation. Dips are providing adding opportunities.
On longer term weekly chart (not shown), silver’s price is trading above its 20 week and 50 week EMAs, but below its falling 200 week EMA in a long-term bear market. Weekly technical indicators are in bullish zones, but not showing much upward momentum.