It’s been a while since our last post on precious metals. The price action right now seems to be offering a decent opportunity for a trade here.
Silver:
Silver Futures - Daily Charts
The last post on silver was on Sept 16th when Silver was around $40 and expected a decline to $26. We are labelling that as part of the third wave and the move off that low has been a struggle and it seems like a corrective pattern and hence labelling as corrective 4. If this is correct, Silver should see a drop to atleast 28.8, if not a new low to 24.5. So a high above the 28th October high would negate this view and should be used as a stop.
Gold:
The technical position for Gold is slightly different but direction is the same.
Gold Futures - Daily Charts
A move above the Oct 28th high would negate the bearish view but Gold is expected to trend lower to 1605 or 1513. A stop above 1755 is a must.
While I’m confident about these setup, the internal sub-divisions on these PM’s is not ideal but I like the Dollar Index’s internal sub-divisons. So I guess this should make for a neat trade.