Gold Continues Momentum
Our 7th August short-term cycle produced a cycle low at the inflection point of $1,680. Gold continues its momentum towards the target following the bounce from inflection. We have labeled the previous week as the “wait and watch” week in order to better understand the next move in gold and silver prices. The last week's candle produced a wide range bar.
While the US dollar is trading at its resistance levels, it indicates that price swings in the forex and commodity markets prevail in the short term. Long term, we remain bearish on the US dollar and bullish on gold and silver, but short-term corrections could destroy investor’s expectations. This weekly report will focus on the technical analysis to find the next move in both metals.
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Briefing
Summary of Article
The strong inflection point of 1680 is responsible for the bullish reaction in gold and silver. Prices are reacting to the fact that strong support has been established. The short-term outlook remains bullish, but 1810 is the first mini-resistance level, and 1825-1835 is strong resistance. Silver’s pivot point is 23.01, and any drop could be interpreted as a bearish signal. The broad ranges of 1700-1900 in gold and 22-30 in silver remain active, and it is pointless to look deeper into the details until these broad ranges are broken.
Personal Opinion
My eyes don’t capture any bullish move until 1835 is cleared. For short term 1810 and then 1835-25 are big spots to be captured by WEDNESDAY (24-25th). For Silver 23.90-24.00 zone is PIVOT. If silver did not break 24 and break 23, it would be negative signal to 20.80. I don’t trace any bulls until gold breaks 1835, and silver breaks 25.75. The bullish Structure is still not clear to me.
Note: The summary of the article is a synopsis of all of our specialist’s work. For example, cycles, technical, fundamental, and other perspectives from our team of specialists. The facts are contained in this summary, which is written by the Chief. While the personal opinion is personal thoughts of our Chief. In simple words, he expresses his personal thoughts or feelings about the market. So, you can enjoy the personal opinion and thoughts of a 25-year experience every weak. These sections were added in response to member requests.
Trading Comments
Traders will look to sell any rally to 1824 or 1835 with High Risk. Traders will also sell 1765 to target 1725. Until these numbers are breached clearly, prices are likely to dance in between them. Traders will also sell Silver 23.90. Any breach of 23 is strongly bearish signal.
Market Overview
The chart below depicts what we predicted a few weeks ago when gold was at 1835. A drop followed by a quick reversal. A drop has occurred, and gold is now attempting to rise, but strong resistances may emerge to halt this rally.
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Weekly Gold Charts
According to the weekly chart below, gold prices are approaching the 50-week exponential moving average (EMA). The history demonstrates the significance of this EMA. A weekly close above this average indicates that gold is on its way to 1900.
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For the past six months, we’ve been debating the big numbers of 1765 and 1725. Each time, these figures prove their significance. In recent weeks, gold has not closed below 1765. The descending broadening line in the chart below is located at 1765 as well. Any drop to 1765 could be a good buying opportunity for the week. The trend line of the descending triangle is now also at 1835, which is significant resistance. A break of major resistances, usually accomplished by large moves. As a result, we are cautious.
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Let’s look at the weekly channels chart. The expected drop towards 1725 exceeded the line by 40 dollars in just a few minutes, allowing it to recover and return above the line at 1725. The drop is comparable to the 2020 drop (Covid-19). A continuation through 1835 would be a good sign.
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Gold Short-Term Outlook
In the short term, prices are expected to rise toward 1835. The chart presented last week is still in effect, as the cup and handles are pushing prices higher towards 1835. We continue to respect the major resistances. The first mini-resistance is 1790-1810, followed by a strong barrier of 1835. Prices are moving towards 1835, as discussed last week, with the 1790-1810 barrier acting as a serious obstacle.
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Silver Outlook
Silver’s short-term chart, which was shown last week, produced a bear flag, and prices moved to major supports. For the past few months, we’ve been watching 23.01 as a major support level. The recent drop below 23.01 (towards 22) was merely a bear trap, as prices quickly recovered above this level. So far, two drops to 23.01 have resulted in a strong bounce.
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Let’s talk about the recent drop that resulted in a double bottom (if 24.01 is broken). Only a clear break of 24.01 will confirm the short-term double bottom. This breakout will initially push silver up to the resistance levels. However, price breakouts are not as reliable in today’s world. A quick drop back below 23.90 could put an end to all of the bullish scenarios. Any breach of 23 would be interpreted as a bear signal.
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The weekly chart is shown below. The previous week’s candle was a coiling candle. That means the candle’s highs and lows were within the previous candle’s range. This type of action has a coiling effect and suggests that a break of 23 would be faster. A break of 24 will, on the other hand, be a bullish sign.
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No Point to Do Extreme Analysis
Extreme analysis is pointless because both metals are trading in large, wide ranges. Silver’s chart shows no progress in a year, while gold’s chart shows wide ranges. There is no point in digging deeper into details until these ranges are breached. In a nutshell, gold is in the 1700-1900 range, with 1835 being the first stumbling block. Since the 1700 hit, gold is likely to rise to 1900, with 1835 as the first resistance. The same is true for silver. The Old Silver and Gold charts are below.
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Important Levels
1810 is the first resistance. Second resistance is 1825-1835 with 1830 as an absolute number
1790-1787 is the first support. 1775-1765 is second support.
A breach of 1765 would result 1725. A breach of 1810 would result 1835.
Silver has first resistance at 23.90-24.01. A daily close above 24.06 would be a positive sign.
A weekly close above 25.75 would convert the silver to bullish.
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