Gold and Silver charts: rallies ready to resume after another pause


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Gold chart pattern

Overbought weekly technical indicators led to the following concluding comment in the previous post on the daily bar chart pattern of Gold: A pullback towards 1300 is a possibility.”

The expected pullback touched an intra-day low of 1304.70 on Thu. Feb 14, but bounced up after receiving support from the rising 20 day EMA. Gold’s price is trading above its three rising EMAs in a bull market.

Daily technical indicators have corrected overbought conditions, but remain in bullish zones. MACD is below its signal line but its downward momentum has stalled. RSI is moving up towards its overbought zone. Slow stochastic has stopped falling but is not showing any upward momentum yet.

After a sharp rise, the US Dollar index is sliding down a bit. That ought to encourage bulls to push gold’s price higher.

On longer term weekly chart (not shown), gold’s price closed above its three weekly EMAs in long-term bull territory for the eighth week in a row. The impending ‘golden cross’ of the 50 week EMA above the 200 week EMA will technically confirm a return to a long-term bull marketWeekly technical indicators are looking bullish and overbought. Lack of volume support can trigger a consolidation or correction. 

Silver chart pattern


The following comments were made in the previous post on the daily bar chart pattern of Silver: All three daily technical indicators showed negative divergences by touching lower tops, and are showing downward momentum after correcting overbought conditions. Some more correction or consolidation is likely.”

Silver’s price corrected below its 20 day EMA to touch an intra-day low of 15.45 on Thu. Feb 14, but bounced up after receiving good support from its 50 day EMA.

The ‘golden cross’ of the 50 day EMA above the 200 day EMA – though not a convincing one yet – has technically confirmed a return to a bull market. Stronger volume support is required for the rally to sustain. 

Daily technical indicators are looking neutral to bearish. MACD is falling below its signal line in bullish zone. RSI has bounced up in neutral zone after briefly falling below its 50% level. Slow stochastic is falling below its 50% level, but its downward momentum has weakened.

On longer term weekly chart (not shown), silver’s price closed above its 20 week and 50 week EMAs, but below its falling 200 week EMA in a long-term bear market. Weekly technical indicators are in bullish zones. MACD is showing upward momentum. RSI and Slow stochastic are moving sideways.

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