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Tuesday, July 18, 2017

Gold and Silver charts: pullback rallies facing resistances

Gold chart pattern


The following remarks appeared in the previous post on the daily bar chart pattern of Gold: "The 'death cross' of the 50 day EMA below the 200 day EMA will technically confirm a return to a bear market. Bulls may try their best to prevent that."

Gold's price touched an intra-day low of 1204 on Jul 10, but bounced up to close higher - forming a 'reversal day' bar (lower low, higher close). That triggered a pullback rally which is facing resistance from the 20 day EMA.

Note that bulls managed to prevent the 'death cross' of the 50 day EMA below the 200 day EMA. At least for now. May not be for long.

Daily technical indicators have corrected oversold conditions, and are showing upward momentum inside bearish zones. The pullback rally may continue a bit further, but expect resistance from the converging 50 day and 200 day EMAs. 

Gold's price is trading below its 50 day and 200 day EMAs in a bear market. The fact that the price dropped below May 9 'valley' low of 1214 keeps the 'double top' reversal pattern in force (refer previous post), and the possibility of a deeper fall towards the Dec '16 low of 1130.

On longer term weekly chart (not shown), gold’s price closed below its three weekly EMAs in long-term bear territory. Weekly technical indicators are in bearish zones, and not showing any upward momentum.

Silver chart pattern


The following remarks were made in the previous post on the daily bar chart pattern of Silver: "Expect bears to sell on every rise. A test of the Dec '16 low is a possibility."

Silver's price dropped below its Dec '16 low to touch an intra-day low of 15.145 on Jul 10, but bounced up to close higher - forming a 'reversal day' bar (lower low, higher close). 

The subsequent pullback rally is facing resistance from the May 9 low. Bears can be expected to sell at any time.

Daily technical indicators have corrected oversold conditions and showing some upward momentum. Only Slow stochastic has entered bullish zone (above its 50% level). MACD and RSI are still in bearish zones.

On longer term weekly chart (not shown), silver’s price closed well below its three falling weekly EMAs in a long-term bear marketWeekly technical indicators are in bearish zones and showing a bit of upward momentum.

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