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Technical Precious Metals
Written by article default Friday, 30 December 2011 10:26
Morning Report
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Gold moved bearishly during the morning session yesterday after achieving the expected breakout below the initial support of 1549.00-127.2%- of CD leg for the bearish harmonic AB=CD pattern. This breakout was the motive behind reaching the support areas around 1520.00 where Stochastic has entered oversold zones, assisting it to correct mildly. Now, we classify the current price behaviors as normal correction to relieve Stochastic that has created a positive divergence before resuming the downside rally to form the last leg of the potential harmonic pattern, mainly targeting 1480.00-1460.00 zones. Areas of 1603.00 should protect the projected bearishness.
The trading range for today is among the key support at 1475.00 and key resistance now at 1603.00.
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 | 1540.00 | 1533.00 | 1522.00 | 1515.00 | 1500.00 |
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| Resistance | 1555.00 | 1562.00 | 1573.00 | 1587.00 | 1595.00 |
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| Recommendation | Based on the charts and explanations above our opinion is, selling gold around 1562.00 targeting 1480.00 and stop loss above 1604.00 might be appropriate. | ||||
Silver
Morning Report
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Silver rebounded to the upside after reaching areas around the support level at 26.05, where the incline seen lifted silver above 88.6% Fibonacci correction of the upside move, which started from the bottom of 26.02 and ended at the top of 35.68 as shown above on the chart. The metal could form a bullish Bat harmonic pattern, which remains valid as long as the metal is stable above 24.75 and remains ideal as long as the metal is stable above 26.05. This pattern is expected to trigger a correctional move, and could support silver to incline in the coming short-period. Stochastic supports our expectations. However, we should pay attention, where the Bat pattern is very risky due to the several possibilities for the (D) point.
The trading range for today is among the key support at 23.40 and key resistance now at 29.70.
The short-term trend is to the downside targeting 26.65 as far as areas of 48.50 remain intact.
**New York Candlesticks**
| Support | 27.10 | 26.65 | 26.05 | 25.55 | 25.15 |
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| Resistance | 27.50 | 28.10 | 28.60 | 28.85 | 29.05 |
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| Recommendation | Based on the charts and explanations above, our opinion is buying silver around 27.10, and take profit in stages at (28.10 and 29.05) and stop loss with 4-hour closing below 26.05 might be appropriate | ||||
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