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Technical Precious Metals
Written by article default Friday, 20 January 2012 09:39
Morning Report
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Gold has closed negatively below SMA 50 and below the initial resistance level around 1665.00 where the B point of the potential harmonic Crab pattern exists as seen on the provided daily graph. At the same time, Stochastic started to show some kind of weakness but we will continue staying aside until the metal penetrates 1628.00 to prove the effect of the harmonic pattern. Of note, breaching through 1665.00 with a daily closing will negate the harmonic probability of resuming the downside journey of the CD leg.
The trading range for today is among the key support at 1607.00 and key resistance now at 1703.00.
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 | 1650.00 | 1645.00 | 1635.00 | 1628.00 | 1615.00 |
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| Resistance | 1665.00 | 1669.00 | 1673.00 | 1687.00 | 1695.00 |
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| Recommendation | Based on the charts and explanations above our opinion is, staying aside as risk versus reward ratio is too high today. | ||||
Silver
Morning Report
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The level of 30.80 represents a critical barrier, and we recommend reviewing our weekly report for more details regarding this level. As shown above, we find the possible Deep Crab harmonic pattern is still valid, but this structure depends on breaching the level of 30.80-85 and consolidation above it. We expect the metal to provide more bullish attempts today, but consolidation above intraday basis above 29.60 and consolidation above 29.05 in general are necessary for our positive outlook. Stochastic settled in areas around the 50-point level and attempts to provide a positive crossover, which supports our expectations.
The trading range for today is among the key support at 29.05 and key resistance now at 32.75.
The short-term trend is to the downside with steady weekly closing below 48.50 targeting 26.65.
**New York Candlesticks**
| Support | 30.50 | 30.30 | 29.90 | 29.60 | 29.50 |
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| Resistance | 30.85 | 31.00 | 31.30 | 31.60 | 32.10 |
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| Recommendation | Based on the charts and explanations above, our opinion is buying silver around 30.55, and take profit in stages at (31.30 and 32.75) and stop loss with 4-hour closing below 29.60 might be appropriate | ||||
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