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Gold and silver reach resistance

Commentaries & Views

Gold and silver have reached the top of their ranges that we have written about this week. The action we expect from these levels is a pullback to their respective support at $1,900 and $24.50. The congestion pattern they are in is consistent with what markets do as they wait for the strong hands to break them out.

Until gold closes above 1960 and silver above 26, they will remain directionless, and we will stay short. There is no doubt the breakout could be higher, but probabilities suggest a pullback to support. Remember, probability is what trading is all about.

Nothing is ever guaranteed. Who would believe, with all the geopolitical risk, soaring inflation and a broken supply chain, that gold and silver would be consolidating while equities push higher? This is why price action, not news, drives the markets in both directions.

Precious metals should be owned on a physical basis with capital that is not needed tomorrow or anytime soon. Trading should be done with paper, knowing that we can trade either side without emotions.

In all markets, price action determines what will happen in the next day, week, or months. Keep the two strategies separate. The worst trade anyone can make is turning a trade into an investment hoping for a way out. Traders must learn to take their losses and move on to the next trade.

Patience, discipline, and money management always win the day. Let the map of the markets show you the way.

Join us Monday, March 28, for the Monday Night Strategy Call. The link to register is below.

2022-03-28 Monday Night Strategy Call

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.