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Technical Precious Metals
Written by article default Wednesday, 02 November 2011 07:46
Morning Report
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After achieving about 42% of the target distance of yesterday's captured head and shoulders top pattern -check the previous recommendation- the metal moved upwards once more. The daily closing above 1702.00 after touching SMA 100 contradicts with the negativity on Stochastic. Consequently, we will be neutral today as risk versus reward ratio is too high if we decided to follow one of the above conflicting signs. Of note, if we see another attempt to breach 1702.00, we may witness a sharp drop below it this time.
The trading range for today is among the key support at 1635.00 and key resistance now at 1785.00.
The general trend over the short term basis is to the upside targeting 1945.00 per ounce as far as areas of 1475.00 remain intact with weekly closing.
| Support | 1715.00 | 1702.00 | 1695.00 | 1687.00 | 1673.00 |
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| Resistance | 1728.00 | 1735.00 | 1745.00 | 1753.00 | 1763.00 |
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| Recommendation | Based on the charts and explanations above our opinion is, staying aside until an actionable technical setup presents itself to pinpoint the next big move. Of note, risk versus reward ratio is too high. | ||||
Silver
Morning Report
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Stability above 30.30 again after reaching lower levels yesterday confirmed the validity of the ascending triangle formation, where as shown on the minor image, and after reaching the triangle’s base, the metal returned to incline, to currently settle above 50% Fibonacci correction, where this move is accompanied with the positivity seen on Stochastic, as the indicator attempts to breach the 50-point level. Therefore, we expect an upside movement today, supporting silver to test primarily the resistance level at 34.30, while consolidation above 34.60 could trigger a test of levels around 35.05. Consolidation below 32.40 can negate our suggested scenario.
The trading range for today is among the key support at 31.60 and key resistance now at 36.80.
The short-term trend is to the downside targeting 26.65 as far as areas of 48.50 remain intact.
| Support | 33.30 | 33.05 | 32.95 | 32.60 | 32.10 |
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| Resistance | 33.75 | 34.00 | 34.30 | 34.60 | 35.10 |
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| Recommendation | Based on the charts and explanations above, we recommend buying silver around 33.30 and take profit in stages at (34.30 and 35.05) and stop loss below 32.05 might be appropriate. | ||||
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