Gold and silver prices are lower in the early U.S. trading Wednesday. Gold hit a six-week low and silver fell to a seven-week low. Silver has seen its near-term price uptrend (on the daily chart) negated this week and gold is in serious danger of seeing its near-term uptrend ending. A rallying U.S. dollar index recently and a rebound in global stock markets at mid-week are bearish elements for the precious metals markets. December gold futures were last down $13.40 at $1,885.90 and December Comex silver was last down $0.803 at $23.72 an ounce.
Gold and silver bulls are confounded this week. Their markets sold off, along with the global stock markets, on Monday, but then also see selling pressure at mid-week when the world stock indexes are rebounding. It appears the safe-haven metals need a new fundamental spark to jumpstart upside price action. Don’t be surprised if such occurs sooner rather than later.
Technically, the December gold futures bulls have the overall near-term technical advantage but are fading and need to show fresh power very soon to keep the near-term price uptrend alive. Bulls’ next upside price objective is to produce a close in December futures above solid resistance at this week’s high of $1,962.90. Bears’ next near-term downside price objective is pushing futures prices below solid technical support at the August low of $1,874.20—which would negate the near-term price upternd. First resistance is seen at the overnight high of $1,900.00 and then at the overnight high of $1,909.90. First support is seen at the overnight low of $1,876.10 and then at $1,874.20.
Overall, the bias in prices is: Downwards.
Note: this chart shows extraordinary price action to the downside.
The projected upper bound is: 1,943.86.
The projected lower bound is: 1,779.14.
The projected closing price is: 1,861.50.
A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 3 white candles and 7 black candles for a net of 4 black candles. During the past 50 bars, there have been 29 white candles and 21 black candles for a net of 8 white candles.
A spinning top occurred (a spinning top is a candle with a small real body). Spinning tops identify a session in which there is little price action (as defined by the difference between the open and the close). During a rally or near new highs, a spinning top can be a sign that prices are losing momentum and the bulls may be in trouble.
Three black candles occurred in the last three days. Although these candles were not big enough to create three black crows, the steady downward pattern is bearish.
Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 10.5263. This is an oversold reading. However, a signal is not generated until the Oscillator crosses above 20 The last signal was a buy 12 period(s) ago.
Relative Strength Index (RSI)
The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 33.29. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a sell 32 period(s) ago.
Commodity Channel Index (CCI)
The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is -196.This is an oversold reading. However, a signal isn’t generated until the indicator crosses above -100. The last signal was a sell 16 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a sell 4 period(s) ago.
Rex Takasugi – TD Profile
PREC.M.XAU= closed down -3.320 at 1,860.230. Volume was 8,900% above average (trending) and Bollinger Bands were 8% narrower than normal.
Open High Low Close Volume 1,862.420 1,864.468 1,853.324 1,860.230 11,657
Technical Outlook Short Term: Oversold Intermediate Term: Bearish Long Term: Bullish
Moving Averages: 10-period 50-period 200-period Close: 1,924.06 1,941.36 1,723.43 Volatility: 16 27 23 Volume: 1,166 233 58
Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.
PREC.M.XAU= is currently 7.9% above its 200-period moving average and is in an downward trend. Volatility is relatively normal as compared to the average volatility over the last 10 periods.
Our volume indicators reflect very strong flows of volume out of XAU= (bearish). Our trend forecasting oscillators are currently bearish on XAU= and have had this outlook for the last 22 periods.