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What’s inside:

  • Gold & silver prices declining in a slow manner, potentially bullish pattern developing
  • Descending wedges in both are coming into view, but need to first be validated
  • Until then, we must respect the bearish downward price sequence currently in place

What is expected to drive Precious Metals into year-end? To find out, check out the DailyFX Q4 Forecast.

Last week, when we looked at precious metals we painted a bearish picture, with focus on targets of 1260-ish for gold and low-16s for silver. They are slowly grinding in that direction, but have a possible bullish alternate path to be considered.

Starting with the weaker of the pair – gold – it’s not too far away from reaching the confluence of support surrounding 1260 our focus has been on. Yesterday, in the weekly commodities/indices webinar we discussed it as an initial target for this current leg lower from over 1300. There are three points of interest around 1260 – December trend-line, 200-day MA, and the monthly low at 1260.8. The alternate path here, just as we’ll look at with silver, is a descending wedge which could hold bullish implications. If it comes to pass, it would also be taking shape at a trend-line off the July low.

It’s only a scenario until price action corroborates the pattern. That is, a breakout above the top-side trend-line needs to take place to bring this into the light. There would likely be a struggle upon approach of 1296+, but the pattern breakout could at least offer up a bounce until resistance is met. But as long as sequence of of lower lows, lower highs maintains we will continue to run with a lower bias.

Gold: Daily

Gold & Silver Price Analysis Paints a Pair of Possibilities

4-hr

Gold & Silver Price Analysis Paints a Pair of Possibilities

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Silver has been holding up a bit better than gold, it's not even near the low-16s we’ve been targeting. It could still get there with a little time, but the bullish descending wedge alternative is one worthy of consideration. No different than gold, it will first need to take out the top-side trend-line of the wedge before it will be validated. Until then downward sequence in price action needs to be respected.

Silver: 4-hr

Gold & Silver Price Analysis Paints a Pair of Possibilities

---Written by Paul Robinson, Market Analyst

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