GOLD AND SILVER UPDATE (1:00 pm EST)
Today gold prices are breaking below $1264, which is not a good sign, but silver remains above $16.06 so we still have a valid bullish divergence signal in this market, and we are still in a reversal zone for precious metals (it ends tomorrow). Both metals are also close to support levels, and the U.S. Dollar Index is looking at least short-term bearish. A rally in these metal prices is still possible, but it must start now as both gold and silver are close to breaking down from their massive inverted head and shoulder chart patterns (see June 17 blog post). We currently have a small loss on our gold long position (about 2%), but our recent profits in silver and crude oil are more than making up for this. (We are out of silver but still long in crude). Conservative traders may want to unload gold long positions now, but I still think there is a chance of a rally which would allow us to sell our gold at a better price (or even a profit). Holding my long gold position for now. If silver drops below $16.06 or these metals move lower after Wednesday, we will sell our gold. Tight stop losses on any gold long positions would be appropriate at this juncture at any point below the current price to guard against a sudden price plunge.
Today gold prices are breaking below $1264, which is not a good sign, but silver remains above $16.06 so we still have a valid bullish divergence signal in this market, and we are still in a reversal zone for precious metals (it ends tomorrow). Both metals are also close to support levels, and the U.S. Dollar Index is looking at least short-term bearish. A rally in these metal prices is still possible, but it must start now as both gold and silver are close to breaking down from their massive inverted head and shoulder chart patterns (see June 17 blog post). We currently have a small loss on our gold long position (about 2%), but our recent profits in silver and crude oil are more than making up for this. (We are out of silver but still long in crude). Conservative traders may want to unload gold long positions now, but I still think there is a chance of a rally which would allow us to sell our gold at a better price (or even a profit). Holding my long gold position for now. If silver drops below $16.06 or these metals move lower after Wednesday, we will sell our gold. Tight stop losses on any gold long positions would be appropriate at this juncture at any point below the current price to guard against a sudden price plunge.
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