Best of the Week
Most Popular
1. TESLA! Cathy Wood ARK Funds Bubble BURSTS! - 12th May 21
2.Stock Market Entering Early Summer Correction Trend Forecast - 10th May 21
3.GOLD GDX, HUI Stocks - Will Paradise Turn into a Dystopia? - 11th May 21
4.Crypto Bubble Bursts! Nicehash Suspends Coinbase Withdrawals, Bitcoin, Ethereum Bear Market Begins - 16th May 21
5.Crypto Bubble BURSTS! BTC, ETH, XRP CRASH! NiceHash Seizes Funds on Account Halting ALL Withdrawals! - 19th May 21
6.Cathy Wood Ark Invest Funds Bubble BURSTS! ARKK, ARKG, Tesla Entering Severe Bear Market - 13th May 21
7.Stock Market - Should You Be In Cash Right Now? - 17th May 21
8.Gold to Benefit from Mounting US Debt Pile - 14th May 21
9.Coronavius Covid-19 in Italy in August 2019! - 13th May 21
10.How to Invest in HIGH RISK Tech Stocks for 2021 and Beyond - Part 2 of 2 - 18th May 21
Last 7 days
Reverse REPO Market Brewing Financial Crisis Black Swan Danger - 29th Jul 21
Next Time You See "4 Times as Many Stock Market Bulls as There Are Bears," Remember This - 29th Jul 21
USDX: More Sideways Trading Ahead? - 29th Jul 21
WEALTH INEQUALITY WASN'T BY HAPPENSTANCE! - 29th Jul 21
Waiting On Silver - 29th Jul 21
Showdown: Paper vs. Physical Markets - 29th Jul 21
New set of Priorities needed for Unstoppable Global Warming - 29th Jul 21
The US Dollar is the Driver of the Gold & Silver Sectors - 28th Jul 21
Fed: Murderer of Markets and the Middle Class - 28th Jul 21
Gold And Silver – Which Will Have An Explosive Price Rally And Which Will Have A Sustained One? - 28th Jul 21
I Guess The Stock Market Does Not Fear Covid - So Should You? - 28th Jul 21
Eight Do’s and Don’ts For Options Traders - 28th Jul 21
Chasing Value in Unloved by Markets Small Cap Biotech Stocks for the Long-run - 27th Jul 21
Inflation Pressures Persist Despite Biden Propaganda - 27th Jul 21
Gold Investors Wavering - 27th Jul 21
Bogdance - How Binance Scams Futures Traders With Fake Bitcoin Prices to Run Limits and Margin Calls - 27th Jul 21
SPX Going for the Major Stock Market Top? - 27th Jul 21
What Is HND and How It Will Help Your Career Growth? - 27th Jul 21
5 Mobile Apps Day Traders Should Know About - 27th Jul 21
Global Stock Market Investing: Here's the Message of Consumer "Overconfidence" - 25th Jul 21
Gold’s Behavior in Various Parallel Inflation Universes - 25th Jul 21
Indian Delta Variant INFECTED! How infectious, Deadly, Do Vaccines Work? Avoid the PCR Test? - 25th Jul 21
Bitcoin Stock to Flow Model to Infinity and Beyond Price Forecasts - 25th Jul 21
Bitcoin Black Swan - GOOGLE! - 24th Jul 21
Stock Market Stalling Signs? Taking a Look Under the Hood of US Equities - 24th Jul 21
Biden’s Dangerous Inflation Denials - 24th Jul 21
How does CFD trading work - 24th Jul 21
Junior Gold Miners: New Yearly Lows! Will We See a Further Drop? - 23rd Jul 21
Best Forex Strategy for Consistent Profits - 23rd Jul 21
Popular Forex Brokers That You Might Want to Check Out - 22nd Jul 21
Bitcoin Black Swan - Will Crypto Currencies Get Banned? - 22nd Jul 21
Bitcoin Price Enters Stage #4 Excess Phase Peak Breakdown – Where To Next? - 22nd Jul 21
Powell Gave Congress Dovish Signs. Will It Help Gold Price? - 22nd Jul 21
What’s Next For Gold Is Always About The US Dollar - 22nd Jul 21
URGENT! ALL Windows 10 Users Must Do this NOW! Windows Image Backup Before it is Too Late! - 22nd Jul 21
Bitcoin Price CRASH, How to SELL BTC at $40k! Real Analysis vs Shill Coin Pumper's and Clueless Newbs - 21st Jul 21
Emotional Stock Traders React To Recent Market Rotation – Are You Ready For What’s Next? - 21st Jul 21
Killing Driveway Weeds FAST with a Pressure Washer - 8 months Later - Did it work?- Block Paving Weeds - 21st Jul 21
Post-Covid Stimulus Payouts & The US Fed Push Global Investors Deeper Into US Value Bubble - 21st Jul 21
What is Social Trading - 21st Jul 21
Would Transparency Help Crypto? - 21st Jul 21
AI Predicts US Tech Stocks Price Valuations Three Years Ahead (ASVF) - 20th Jul 21
Gold Asks: Has Inflation Already Peaked? - 20th Jul 21
FREE PASS to Analysis and Trend forecasts of 50+ Global Markets by Elliott Wave International - 20th Jul 21
Nissan to Create 1000s of jobs with electric vehicle investment in UK - 20th Jul 21

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Gold Fails to Respond to Middle East Crisis, Looks Ready for More Downside Action

Commodities / Gold and Silver 2011 Feb 13, 2011 - 09:45 AM GMT

By: Merv_Burak

Commodities

Best Financial Markets Analysis ArticleThe upheaval in the Middle East has done nothing for gold.  It looks like gold is ready for more downside action.  A move to $1305 would not be good.  The “Penny Arcade Index” is still okay so any downside activity shouldn’t last for too long.


GOLD : LONG TERM

First, the P&F chart.  As mentioned previously, it had given me a bear signal but there was still a support at the $1320 mark to be overcome before really going bearish.  This requires, on the P&F chart, a move to the $1305 level, which the price has not yet met.  So, we are in limbo for now.  A move to the $1305 level would also cross below the long term moving average line and turn the line downward further confirming the bear, at that time.  So, we wait.

Looking at the usual indicators, the price of gold remains above the long term moving average line.  The line itself is still in an upward slope but is turning towards the horizontal ready to turn down on the slightest provocation.  The long term momentum indicator continues in its positive zone and is once more above its now positive trigger line.  However, weakness is shown in that it just can’t seem to get any significant upward trend going.  The volume indicator seems to have topped out and is in a basic lateral drift.  It continues to move above and below its trigger line in the process.  It is below the trigger on Friday however, the trigger is still very, very slightly in a positive slope.  All in all the long term rating still remains BULLISH.

INTERMEDIATE TERM

On the intermediate term we have a somewhat less favorable story.  Gold continues to track below its negative sloping moving average line.  The intermediate term momentum indicator has now moved above its neutral line into the positive zone and above a positive trigger line.  As for the volume indicator, it continues to be basically below its trigger line and the trigger remains in a negative slope.  On the intermediate term the rating is only at the – NEUTRAL level, one step above a full bear.  The short term moving average line, although moving upwards, is still below the intermediate term line for a negative reading and confirmation of the negative rating.

SHORT TERM

Although it looks like we are in a short up trend it also looks like a topping activity getting ready for some more down side action.  A drop below $1350 would put us into such a negative phase.  For now gold price remains above its short term moving average line and the line slope remains upward.  The momentum indicator is just very slightly above its neutral line and above its positive trigger line but that could change with another negative day of activity.  The daily volume action is still pretty low and below its average volume over the past 15 days.  For now the rating remains BULLISH with the very short term moving average line confirming.

As for the immediate direction of least resistance, I’m going with the down side for Monday.  The past two days have been negative days and the Stochastic Oscillator has just dropped below its overbought line and below its trigger line and seems to be heading lower.

SILVER

Silver has out performed gold this past week and just about made it into new high territory but stumbled and is getting ready for more down side action.  A little bit of positive view is the fact that although the last two days were negative days for silver, the price each day seems to have rebounded significantly from the day’s lows and appears not to want to go lower.  So, maybe the downside is not in the works but only a very short rest.

For today everything is still on the plus side.  For the long term silver is still in no danger from any reversal so the rating remains BULLISH.

On the intermediate term everything is also positive with silver above its positive moving average line and the momentum indicator in its positive zone above its positive trigger line.  The volume indicator is slightly above its trigger line although the trigger is still pointing downward.  In all, the indicators suggest the intermediate term rating is BULLISH.  The short term moving average line has just crossed above the intermediate term line for confirmation.

On the short term the trend is still in a positive direction BUT it does seem to be topping out.  We do have a slight up trending short term wedge pattern that was broken to the down side on Friday.  A short term up trend in the momentum indicator was broken the day before.  However, as of the Friday close we are still in positive territory.  The price of silver remains above its positive sloping moving average line and the short term momentum indicator remains in its positive zone.  The indicator has, however, turned to the down side and is sitting right on top of its trigger line.  The daily volume activity is still pretty low and not helping.  It is slightly below its average volume over the past 15 days.  Still, with everything considered the short term rating remains BULLISH with the very short term moving average line confirming.

PRECIOUS METAL STOCKS

I had been asked by many viewers to post my Composite Index of Precious Metals Indices more often, so here it is today.

The Composite Index is, of course, based upon the average weekly performance of all the components of the Table posted here each week.  There are a few interesting features shown on the chart.  We have a slight expanding wedge pattern (commonly referred to as a megaphone pattern).  This pattern, once well established, is not a positive pattern and usually suggests a volatile weakness in the price activity.  Too often it ends up with the price moving to lower levels, breaking the lower support line.  For now we see the recent Index price hitting the upper resistance line and reacting.  Now the question is, how low will it go?  Although difficult to see, we did have a sharp up trend line from the August low which was broken on the first week of January.  Going over to the long term momentum we see that it is still comfortably, for now, within its positive zone and more importantly, the recent January top did not give us a negative divergence so the move was still quite positive.

I wouldn’t go into performing a ratings review on the Composite.  I think it’s more important to rate the individual Indices and especially the particular sector (see the Merv’s Indices) of the precious metals one is interested in.

Merv’s Precious Metals Indices Table

Well, that’s it for this week.  Comments are always welcome and should be addressed to mervburak@gmail.com.

By Merv Burak, CMT
Hudson Aero/Systems Inc.
Technical Information Group
for Merv's Precious Metals Central

For DAILY Uranium stock commentary and WEEKLY Uranium market update check out my new Technically Uranium with Merv blog at http://techuranium.blogspot.com .

During the day Merv practices his engineering profession as a Consulting Aerospace Engineer. Once the sun goes down and night descends upon the earth Merv dons his other hat as a Chartered Market Technician ( CMT ) and tries to decipher what's going on in the securities markets. As an underground surveyor in the gold mines of Canada 's Northwest Territories in his youth, Merv has a soft spot for the gold industry and has developed several Gold Indices reflecting different aspects of the industry. As a basically lazy individual Merv's driving focus is to KEEP IT SIMPLE .

To find out more about Merv's various Gold Indices and component stocks, please visit http://preciousmetalscentral.com . There you will find samples of the Indices and their component stocks plus other publications of interest to gold investors.

Before you invest, Always check your market timing with a Qualified Professional Market Technician

Merv Burak Archive

© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in