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Gold & Silver; Retraced but with a view

Mar
25

Unfortunately there is some truth on the above excerpt given the vast differences and divergence to include the fact that time has changed. However, capitalism had made those intelligent a lot richer compared to the time of Mr Tesla as depicted. On the contrary, the rich do get richer while the poor or oppressed remain where they are until such time changed. The economy and capitalism as a whole promote innovation, risk taking as well as aspiration. The truth is that everybody is trying to live a life that they do not belong to and certain aspiration is created within a cycle of debt. 2008 financial crash seems distant away but painful memories are still there as the world leaders and economists look at unconventional ways to mend the irrecoverable. Short-termism is a culture ingrained within the financial industry, followed then by slack government controls and it is in our human nature that nothing is ever good enough.

Gold Technical Outlook
Weekly Chart

Our last commentary, we warned a make or break on gold as $ 1400 is within sight. Failure to move higher despite the escalation in Crimea has done little to promote safe haven buying. The initial news have long left the bull camp, rather the market was washed with false expectation that prices could continue to move higher to test the magic number. The bears disagree and profit taking as we approach the end of the quarter seems far more viable. Looking closer at the below weekly chart, the downtrend line still prevail and another round down the south coast on the chart seems possible.


Resistance: $ 1355, $ 1367.50, $ 1377 Support: $ 1286, $ 1293, $ 1308

Traders Notes: Only buy on the break of $ 1366 but with a stop at $ 1356. If not buy on support at $ 1271 stop at $ 1251.
Short Term (1 – 3 weeks) Medium Term (1 – 3 months) Long Term (6- 12 months)
Bearish $ 1278 Bullish - $ 1387 Target $ 1550

Silver Technical Outlook
Weekly Chart

Our previous attempt to short the white metal failed as we went in too early. However, our last commentary was rather on the spot as Silver did take a pause of uncertainty. The bears drove the price lower despite a push in gold, usually a contrary trade that signal distortion. Gold and Silver ratio gave another hint that gold prices face impending pullback as the US dollars is poised to retrace higher after several weeks of weakness. The break lower was justified and we stick to our view that prices should retraced before advancing higher. Main concern only lies on the long term downtrend line that will continue to build pressure.

Resistance: $ 21.85, $ 22.20, $ 22.45 Support: $ 19.50, $ 20.77, $ 21.05

Traders Notes: Should the price stabilise and found support at $ 19.50, buy with a stop loss of $ 0.30 to target the downtrend line at $ 21.40.
Short Term (1 – 3 weeks) Medium Term (1 – 3 months) Long Term (6 – 12 months)
Flat Flat Bullish – a potential bull run?

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