Make Kitco Your Homepage

Contributed Commentaries

Gold bulls give some back. Now what?

Jonathan Da Silva

Kitco Commentaries | Opinions, Ideas and Markets Talk

Featuring views and opinions written by market professionals, not staff journalists.

Commentaries & Views

The triangle pattern in gold we had suggested favored a break to the topside has failed. The below chart on the 2-hour timeframe shows the breakdown point and follow-through lower. We had also suggested that should the pattern fail, bulls would put up a fight in the $1740 - 50 area, now highlighted below.

Sign of strength: The below daily chart shows that gold is almost already oversold on the stochastic RSI. Contrary to the downward trend, the price has not put in a lower low as stochastic RSI has turned down (NOTE: it hasn’t bottomed yet). It would also not be unusual for the price to oscillate at a Fibonacci level for support/resistance.

A zoomed-out view of the dollar on the weekly chart shows that although it has found support at the bottom of it’s all too familiar rising channel, a major negative divergence in the RSI continues to flash, with the 200-week moving average far below.

Thanks and have a great day,

By Jonathan Da Silva

Contributing to kitco.com

Contact jdasilva@kitco.com
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.