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Gold and silver fail at resistance

Commentaries & Views

Gold and silver had sharp rallies on Thursday, but in typical market fashion, both failed to close above resistance. The failure was expected, and another test of those levels is also likely. However, the trends will not change until they close above $1,960 for gold or $26 for silver for more than 20 minutes.

Prices in both are lower this morning and could head back to support. Today's action will go a long way towards deciding whether they will change direction and become bullish or stay short. The action is interesting, but the volumes are light.

From a trader's view, this action is brutal; the lack of volume indicates this is a retail rally. This means that the pros and funds are sitting on the sidelines, waiting for the gold and silver bulls to get in before hammering the precious metals. This is common in quiet markets.

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 month. 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.