Silver and Miners have remained above their November lows as gold prices continue to edge lower. This divergence could be a bullish sign if it continues to carry. If it doesn’t hold and prices break below the November lows, then we could see them paly catch-up to gold during a sharp move lower.
Prices are consolidating, and without a trending move, it’s difficult to make money. Just when prices are on the verge of breaking out, they reverse and head the opposite direction. We could see this continue until the FED decision next week. Hot money has moved away from the gold sector and jumped into stocks.
The dollar is correcting into a cycle low, and once it turns up, it could put more pressure on gold prices.
-US DOLLAR- The dollar is correcting and prices are expected to bottom in the target box, likely above the 50-day EMA.
-GOLD- Gold prices dipped down to a new low of $1,158.60 while making an outside reversal day on Monday. A close above $1,191 is needed to make a price swing and potential low.
-SILVER- Prices closed above the 10-day EMA finally, and $16.15 has registered as a low. Prices must move through the resistance box and back above the 200-day MA for it to be considered an intermediate cycle bottom. If prices fail to break through resistance, then prices will drop below $16.00.
-GDX- Miners are still consolidating after the drop to $20.13 on November 14th. Time is running out for them to mount a rally. A decline below $20.13 will void the positive divergence and likely lead to intense selling.
-GDXJ- Junior miners are producing a triangle consolidation, prices need to breakout of the triangle for direction.
-SPY- Prices are back rallying again and never fully closed beneath the 10-day EMA. Investors keep bidding up prices and are no longer interested in gold or gold stocks.
-WTIC- Oil prices stopped at the trendline from the previous peaks. This is the last area of resistance to cap the rally and send prices into a January seasonal low.
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