After an attempt to rally on Friday, the sellers have returned in force in gold, silver, and platinum. Many will be calling manipulation, which is laughable; to complete a trade, there must be a buyer and a seller. The strong hands may be putting pressure; however, there are buyers of the metals that would go to zero.
This morning’s action is the last chance to slow the selling, with gold, silver, and platinum all at major support. Failure here would lead to an additional 5-7% down and a possible massive breakdown. Current targets on the downside are 1700 gold, 18 silver and 800 platinum.
Until further notice, traders should focus on selling rallies that reach a resistance level. Resistance levels to sell are 1760 gold, 20 silver, and 920 platinum. Until those levels are reached, the best trade is to observe. Investors that are accumulating could be small quantity buyers on the way down.
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 me Monday, July 11 for our Monday Night Strategy Call at 4:30 ET.
