PHYS and PSLV – 20 May

Friday was a big up day for gold and PHYS, the real gold bullion fund, was up big time as well. This fund is 100% allocated gold held at the Canadian Royal Mint. This is the vehicle that guarantees the gold in it exists, not paper gold. Stay away from GLD.

The chart is back to neutral after a higher high was painted on the chart. That nullifies the short term down trend that was that bottomed at 12.58. Resistance is still 13.18 with support at 12.58 and 12.38. Price has spent 2.5 months within a horizontal trading channel defined by the support and resistance lines. We need 3 closes above 3.18 to confirm the end of this consolidation period. MACD is hooking and setting up a bullish cross. Stochastic is climbing toward a neutral reading and RSI is starting to climb from neutral.

Silver sure is acting like it has found a bottom. PSLV, the real silver bullion fund, is finding support around 15 and resistance at the 16.22 level. An intraday high above 16.22 confirms a short term up trend continues. the next resistance level is 17.81. MACD is starting to hook and stochastic is about to cross the 20 level from an embedded condition. When this happens the nearest moving average becomes the target, in this case the the 20 and 50 day moving averages that both lie at 17.86. How convenient, chart resistance and moving average resistance are co-located.

The Elder impulse chart is starting to look promising. We are painting blue bars with an increasing MACD histogram and a declining 13 day exponential moving average. The price bar will turn green when the slope of the 13 day EMA turns positive. Remember, all green bars are ignored with the price below the 65 day EMA, therefore price must be above 16.92 tomorrow to generate a buy signal.

The hourly Elder chart is what I use to generate specific buy signals. So if 16.92 is taken out I will buy as long as the hourly is painting a green bar as well.

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