After all of the recent volatility, don't days like today just seem like a downer? I suppose we should be grateful for the respite...but...flat, rangebound days always tend to put me to sleep.
I wish I had some exciting chart news for you but I don't. From every angle, the metals appear to be finishing up the "right shoulder" of the current, 7-month, massive reverse head-and-shoulder bottom. The biggest drag of this is the timing. Take a look at the daily charts below and you can easily see that this final process could take weeks to complete. We could be well into May before the metals finally break higher and confirm the bottom. Until then, I guess we just have to be patient.
Though gold put in a nice day yesterday, it saw very little follow-through today. Don't get me wrong, I'm glad that gold is back above $1650. However, until gold breaks back above the short-term downtrend line on the hourly chart, there's no reason to get excited. Furthermore, until gold closes back above its 200-day moving average, the spec buying will not be sufficient to drive gold consistently higher. Again, for now, we yawn and wait.
Silver is nothing to write home about, either. In fact, it actually looks worse than gold, in the very short term. Though 31.00-31.50 will continue to provide support for silver, the failing momentum in the hourly chart paints a picture of further weakness. Since a drop to $30 or so would paint a nearly perfect, symmetrical reverse H&S on the silver chart, we might as well root for one. At this point, given the ugliness of the hourly chart, I'd say the chances that support holds here are no greater than 50/50. That said, IF silver does drop to the area around $30, you be crazy not to do some buying.
Just a few news items before I return to my afternoon nap. First up, this new report from ZH on the worsening fiscal situation in the U.S. No more QE? Rrrrrright.....
You may have already seen this but Mike Maloney of GoldSilver was on RT a few days ago and spent a half hour discussing metals manipulation with this hot, leggy chick. (I wonder if she's one of Putin's girlfriends?) Regardless, there's some interesting stuff here, particularly the part about South Carolina.
Finally, our pal Jeff Nielson wrote something interesting yesterday. Post-MFG, anyone foolish enough to hold "allocated" metal within their U.S.-based brokerage account is probably too stupid to read and understand this piece but I'll link it here anyway, just for kicks.
That's all for now. TF
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