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24 Jun 2013
Commodities Brief: Metals remain on corrective mode
FXstreet.com (Barcelona) - Both gold and silver are developing a correction higher, all occurring within the context of a new multi-year bearish cycle for the metals complex, as the unload of long positions following the signal of a potential QE taper.
Spot Gold closed the week below psychological 1300 barrier, and is currently trading just under the round number. The lowest level achieved by sellers so far has been 1269, levels last time seen in Sep 2010.
Technicals point to cheaper gold prices
According to Slobodan Drvenica, Analysys Manager at Windsor Brokers, "the Negative sentiment continues to dominate, as technicals hold bearish tone, with corrective rallies seen preceding fresh slide."
Drvenica sees "clearance of initial 1300 barrier, would open limited corrective action towards 1310, 38.2% of 1376/1269 fall, with the next strong resistance at 1321, previous low / 50% retracement, expected to cap."
On the downside, below 1269 opens up new downside potential towards 1250 and psychological 1200 support.
Silver to offer pullback setup to rejoin downtrend - 2ndSkies
Meanwhile, on the silver market, Chris Capre, Founder at 2ndSkies, highlights how price has not had one daily close above the 20ema since Feb 7th. Capre suspects there will be a pullback setup to rejoin the trend, so "I'll look for bearish price action signals around 21.38 which was a key breakout level where the impulsive selling continued" Capre said.
Downside targets are 19.50, and 17.25, while stops would be just above 22.
Spot Gold closed the week below psychological 1300 barrier, and is currently trading just under the round number. The lowest level achieved by sellers so far has been 1269, levels last time seen in Sep 2010.
Technicals point to cheaper gold prices
According to Slobodan Drvenica, Analysys Manager at Windsor Brokers, "the Negative sentiment continues to dominate, as technicals hold bearish tone, with corrective rallies seen preceding fresh slide."
Drvenica sees "clearance of initial 1300 barrier, would open limited corrective action towards 1310, 38.2% of 1376/1269 fall, with the next strong resistance at 1321, previous low / 50% retracement, expected to cap."
On the downside, below 1269 opens up new downside potential towards 1250 and psychological 1200 support.
Silver to offer pullback setup to rejoin downtrend - 2ndSkies
Meanwhile, on the silver market, Chris Capre, Founder at 2ndSkies, highlights how price has not had one daily close above the 20ema since Feb 7th. Capre suspects there will be a pullback setup to rejoin the trend, so "I'll look for bearish price action signals around 21.38 which was a key breakout level where the impulsive selling continued" Capre said.
Downside targets are 19.50, and 17.25, while stops would be just above 22.