Gold and Silver – 9 May

Gold closed the day on the highs, just short of resistance near 1520. RSI is now climbing and stochastic continues to hook. The near term swing low is in place and all that remains is to determine where resistance will carve out the swing high. If 1520 falls convincingly this week, a run back to 1575 is likely in the cards. My guess is that a swing high develops somewhere under the all time high, locking in a technical down trend defined by a lower high and a lower low. Support remains at 1476.

PHYS, the real gold bullion fund closed also near the highs of the day right at resistance of 13.03. Price gapped up on the open and means that in all liklihood price will retrace to fill in the near future. As with the spot gold, we are simply waiting to see where the high will come in and define the upper limit of a future trading range. I would like to see another day or two of gains that will set up 13.05 as the lower boundary of that range and as defined support.

Silver as with gold has bounced convincingly off of support at 33.58 and closed very near the high of the day. RSI is further over-sold than gold and bounced where you would expect it to, right on the 30 level. Current price is right at resistance being brought mainly by the Fibonacci 50% retrace line. Further gains here target the Fibonacci 38.2% retrace line at 40.79. Stochastic has put in a sweet bullish cross and is headed higher. If it crosses the 20 level, the target becomes the nearest moving average, in this case the 45 day MA (blue) at 39.47. 40 is a big round number and would be my guess as to where we will see resistance materialize and form a swing high. Silver needs to consolidate and develop some energy to make a new run to all time highs. Support will remain 33.60.

PSLV, the real silver bullion fund, gapped higher on the open. Gaps fill, so buyers may want to put a bid right there in the middle of it. Resistance is coming in at the current price level around 17.20, and it continues on up through 19.11. Support is coming from the swing low near 15.0. Stochastic crossing 20 will set up the 50 day moving average (blue) as the target and resistance.

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This entry was posted in Gold, PHYS, PSLV, Silver, Technical Analysis. Bookmark the permalink.

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