Shorting Gold And Silver Short Term

In this article, we analyze the gold and silver markets. In the chart, the daily Variable Changing Price Momentum Indicators (VC PMI) are on the left, while the weekly are on the right.


The daily price for gold is $1,477. The weekly average price is $1,479. The extreme level above the mean daily (Sell 1 level) is $1,487, while the Sell 2 level is $1,493. The Buy 1 level below the mean on the daily is $1,470, while Buy 2 is $1,459.

Let's look at the trading targets for the daily and weekly. The weekly above the mean Sell 1 target is $1,494 and the Sell 2 level target is $1,507. The Buy 1 level below the mean is $1,465 and the Buy 2 level is $1,450.

(Click on image to enlarge)

If we look at the current market action, it is trading above both the daily and the weekly average prices, which means the trend momentum is bullish. The market is also trading above the descending trend line resistance at $1,480, which is also a bullish indicator. The VC PMI tells us that since the market is trading in the average daily and weekly price range, it means that there are no trades we would recommend for the futures contract.

"If you are in gold, continue to hold any long or swing positions, but I am hedging with DUST," Equity Management Academy CEO Patrick MontesDeOca said. "I am locking in 50% profits so far year to date, so I want to see a little more validation. I want to see the market come off this distribution of supply area where we have been."

The numbers point to the red zone on the chart, which the VC PMI identifies as distribution of supply. The algorithm triggers the signal when the level touches the key levels.

In gold, we are neutral to bullish, and for day trading, we are waiting for the market to go up to $1,487 and activate a short trigger. This could then lead to a reversion since the algorithm identifies a 90% probability of a reversion from that level.

In the meantime, we are watching the market. If it goes up, we'll watch what it does. We have locked in profit in this range, so we are not missing much. We took a hedge on our long position. The ideal place to enter would be, if you want to go long, to wait for the market to come down to the mean of at least $1,470 daily. The weekly mean is at $1,465. The market is building a level of demand below $1,470, $1,465, $1,459, and $1,450, which is a combination of the daily and weekly signals. They identify where the demand is. Wait for the market to hit those levels and then the artificial intelligence of the VC PMI will tell us what the market will do.

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Disclosure: I/we have no positions in any stocks mentioned, but may initiate a long position in SILJ over the next 72 hours. 

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