Best of the Week
Most Popular
1. TESLA! Cathy Wood ARK Funds Bubble BURSTS! - 12th May 21
2.Stock Market Entering Early Summer Correction Trend Forecast - 10th May 21
3.GOLD GDX, HUI Stocks - Will Paradise Turn into a Dystopia? - 11th May 21
4.Crypto Bubble Bursts! Nicehash Suspends Coinbase Withdrawals, Bitcoin, Ethereum Bear Market Begins - 16th May 21
5.Crypto Bubble BURSTS! BTC, ETH, XRP CRASH! NiceHash Seizes Funds on Account Halting ALL Withdrawals! - 19th May 21
6.Cathy Wood Ark Invest Funds Bubble BURSTS! ARKK, ARKG, Tesla Entering Severe Bear Market - 13th May 21
7.Stock Market - Should You Be In Cash Right Now? - 17th May 21
8.Gold to Benefit from Mounting US Debt Pile - 14th May 21
9.Coronavius Covid-19 in Italy in August 2019! - 13th May 21
10.How to Invest in HIGH RISK Tech Stocks for 2021 and Beyond - Part 2 of 2 - 18th May 21
Last 7 days
How to Protect Your Self From a Stock Market CRASH / Bear Market? - 14th Oct 21
The Only way to Crush Inflation (not stocks) - 14th Oct 21
Why "Losses Are the Norm" in the Stock Market - 14th Oct 21
Sub Species Castle Maze at Alton Towers Scarefest 2021 - 14th Oct 21
Which Wallet is Best for Storing NFTs? - 14th Oct 21
Ailing UK Pound Has Global Effects - 14th Oct 21
How to Get 6 Years Life Out of Your Overclocked PC System, Optimum GPU, CPU and MB Performance - 13th Oct 21
The Demand Shock of 2022 - 12th Oct 21
4 Reasons Why NFTs Could Be The Future - 12th Oct 21
Crimex Silver: Murder Most Foul - 12th Oct 21
Bitcoin Rockets In Preparation For Liftoff To $100,000 - 12th Oct 21
INTEL Tech Stock to the MOON! INTC 2000 vs 2021 Market Bubble WARNING - 11th Oct 21
AI Stocks Portfolio Buying and Selling Levels Going Into Market Correction - 11th Oct 21
Stock Market Wall of Worry Meets NFPs - 11th Oct 21
Stock Market Intermediate Correction Continues - 11th Oct 21
China / US Stock Markets Divergence - 10th Oct 21
Can US Save Taiwan From China? Taiwan Strait Naval Battle - PLA vs 7th Fleet War Game Simulation - 10th Oct 21
Gold Price Outlook: The Inflation Chasm Between Europe and the US - 10th Oct 21
US Real Estate ETFs React To Rising Housing Market Mortgage Interest Rates - 10th Oct 21
US China War over Taiwan Simulation 2021, Invasion Forecast - Who Will Win? - 9th Oct 21
When Will the Fed Taper? - 9th Oct 21
Dancing with Ghouls and Ghosts at Alton Towers Scarefest 2021 - 9th Oct 21
Stock Market FOMO Going into Crash Season - 8th Oct 21
Scan Computers - Custom Build PC 6 Months Later, Reliability, Issues, Quality of Tech Support Review - 8th Oct 21
Gold and Silver: Your Financial Main Battle Tanks - 8th Oct 21
How to handle the “Twin Crises” Evergrande and Debt Ceiling Threatening Stocks - 8th Oct 21
Why a Peak in US Home Prices May Be Approaching - 8th Oct 21
Alton Towers Scarefest is BACK! Post Pandemic Frights Begin, What it's Like to Enter Scarefest 2021 - 8th Oct 21
AJ Bell vs II Interactive Investor - Which Platform is Best for Buying US FAANG Stocks UK Investing - 7th Oct 21
Gold: Evergrande Investors' Savior - 7th Oct 21
Here's What Really Sets Interest Rates (Not Central Banks) - 7th Oct 21
CISCO 2020 Dot com Bubble Stock vs 2021 Bubble Tech Stocks Warning Analysis - 6th Oct 21
Precious Metals Complex Searching for a Bottom - 6th Oct 21
FB, AMZN, NFLX, GOOG, AAPL and FANG+ '5 Waves' Speaks Volumes - 6th Oct 21
Budgies Flying Ability 10 Weeks After wings Clipped, Flight Feathers Cut Grow Back - 6th Oct 21
Why Silver Price Could Crash by 20%! - 5th Oct 21
Will China's Crackdown Send Bitcoin's Price Tumbling? - 5th Oct 21
Natural Gas News: Europe Lacks Supply, So It Turns to Asia - 5th Oct 21
Stock Market Correction: One More Spark to Light the Fire? - 5th Oct 21
Fractal Design Meshify S2, Best PC Case Review, Build Quality, Airflow etc. - 5th Oct 21
Chasing Value with Five More Biotech Stocks for the Long-run - 4th Oct 21
Gold’s Century - While stocks dominated headlines, gold quietly performed - 4th Oct 21
NASDAQ Stock Market Head-n-Shoulders Warns Of Market Weakness – Critical Topping Pattern - 4th Oct 21
US Dollar on plan, attended by the Gold/Silver ratio - 4th Oct 21
Aptorum Group - APM - High RIsk Biotech Stocks Buy, Sell, Hold Investing Analysis for the Long-run - 3rd Oct 21
US Close to Hitting the Debt Ceiling: Gold Doesn’t Care - 3rd Oct 21
Powell: Inflation Might Not Be Transitory, After All - 3rd Oct 21
Original Oculus VR HeadSet Rift Dev Kit v1 Before Facebook Bought Oculus - 3rd Oct 21
Microsoft Stock Valuation 2021 vs 2000 Bubble - Buy Sell or Hold Invest Analysis - 1st Oct 21
How to profit off the Acquisition spree in Fintech Stocks - 1st Oct 21
�� Halloween 2021 TESCO Shopping Before the Next Big Panic Buying! �� - 1st Oct 2
The Guide to Building a Design Portfolio Online - 1st Oct 21
BioDelivery Sciences International - BDSI - High RIsk Biotech Stocks Buy, Sell, Hold Investing Analysis for the Long-run - 30th Sep 21
America’s Revolving-Door Politics Behind the Fall of US-Sino Ties - 30th Sep 21
Dovish to Hawkish Fed: Sounds Bearish for Gold - 30th Sep 21
Stock Market Gauntlet to the Fed - 30th Sep 21
Should you include ESG investments in your portfolio? - 30th Sep 21
Takeda - TAK - High RIsk Biotech Stocks Buy, Sell, Hold Investing Analysis for the Long-run - 29th Sep 21
Stock Market Wishing Away Inflation - 29th Sep 21
Why Workers Are NOT Returning to Work as Lockdown's End - Wage Slaves Rebellion - 29th Sep 21
UK Fuel PANIC! Fighting at the Petrol Pumps! As Lemmings Create a New Crisis - 29th Sep 21
Gold Could See Tapering as Soon as November! - 29th Sep 21

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Gold and Silver Developing Bearish Formations

Commodities / Gold & Silver 2009 Apr 18, 2009 - 07:58 PM GMT

By: Merv_Burak

Commodities Best Financial Markets Analysis ArticleSince reaching its recent high in late February gold has been tracking a basic downward path.  It closed on Friday at a new reaction low.  Is this to continue into a new bear market move or are we in for a reversal ahead?


We’ve had an up move and a down move on that long term point and figure (P&F) chart shown last week but other than that there is no change to its message.  It is still in a BEAR mode with a projection to the $705 level.

As for the normal indicators, those also haven’t changed although they are getting very, very close to a reversal signal from their present bullish rating.  The price of gold is sitting right on top of its still positive sloping moving average line and the momentum indicator remains in its positive zone.  The momentum indicator is, however, only very slightly above its neutral line and heading lower below its negative sloping trigger line.  Another down week in the price of gold and most likely we will see these indicators go negative.  The volume indicator continues to move in a basic horizontal direction with a slight negative bias.  It is below its negative sloping trigger line.  However, looking at all the indicators the long term rating continues to be BULLISH but in a very, very precarious position.



Everything on the intermediate term just keeps getting more negative.  The price of gold is moving further away from its intermediate term negative sloping moving average line and the momentum indicator has once more moved into its negative zone below its negative sloping trigger line.  The volume indicator continues to drift slightly lower below its negative sloping trigger line.  Finally, the short term moving average line is moving further and further away and below the intermediate term line.  We have consistently seen that a trend reversal has a rough time as long as the short term moving average line continues below its intermediate term line.  On the intermediate term the only rating I can give is a BEARISH rating.



When we have the very short term moving average line (8 DMAw) below the short term line, and heading lower, it’s a good guess that the short term direction is not to the up side.  Gold tried to break above its short term moving average line during the week but failed.  It is once more moving lower, below its negative sloping short term line.  The short term momentum indicator remains in its negative zone where it has basically been for about the past two months (except for a very brief period in mid-March).  The daily volume activity has been very low recently but I expect that will perk up shortly.  On the short term the rating continues to be BEARISH.



As for the immediate direction of least resistance, well, after a brief rally in the Stochastic Oscillator it has once more moved into its negative zone and heading lower.  The short term trend continues lower as the red trend line shows.  The direction is therefore towards the down side for now.




Recently silver seems to be under performing gold.  It has broken into new reaction lows since hitting its high in February but has not yet issued a P&F bear signal, unlike gold.  What we see on the chart is what is often referred to as a downward sloping bullish flag pattern.  It often occurs at a move’s half way point and is a time when the price takes a breather, resting up for its next thrust.  If that’s the case and the price does reverse back to the up side then that implies a move to about the $18 mark.  That’s not far from my point and figure projection of $18.50.


For now the intermediate term, which is the time period I find most important, has indicated a bearish trend.  The price is below its intermediate term moving average line and the line slope has turned downward.  The momentum indicator has moved into its negative zone and is below its negative trigger line.  And, of course, the short term moving average line remains below the intermediate term line.  The intermediate term rating can only be BEARISH until things perk up.







The PHLX Gold/Silver Sector Index is probably the best known of the major North American gold Indices.  It is presently at a very interesting juncture.  Although both silver and gold have a bullish downward sloping flag pattern this Index has an upward sloping one.  It could more realistically be called an upward sloping channel.  Unfortunately, these upward sloping channels have a habit of the price breaking below its lower support line for a bearish break.  The Index is sitting almost on top of the support line.  The Index itself is below its negative sloping intermediate term moving average line and the intermediate term momentum indicator is now in its negative zone below its negative trigger line.  Everything here suggests that we are in for more down side action ahead although there still is a slime possibility of a bounce off the support line.


This does not portent well for gold and silver stocks.  It is best to hold off any purchases until the dust settles and we have some indication that the up side is once more in play.  Otherwise, any purchases must be seen as having a greater degree of risk involved.


As a comparison, my own comparative Index, the Merv’s Qual-Gold Index, has already moved into new lows below the February level.  About the only differences between the ratings of the Merv’s Indices and the major North American Indices is in the long term time frame where the Merv’s Indices have not yet started to show a concern.


Merv’s Precious Metals Indices Table



Well, that's it another week.

By Merv Burak, CMT
Hudson Aero/Systems Inc.
Technical Information Group
for Merv's Precious Metals Central

For DAILY Uranium stock commentary and WEEKLY Uranium market update check out my new Technically Uranium with Merv blog at .

During the day Merv practices his engineering profession as a Consulting Aerospace Engineer. Once the sun goes down and night descends upon the earth Merv dons his other hat as a Chartered Market Technician ( CMT ) and tries to decipher what's going on in the securities markets. As an underground surveyor in the gold mines of Canada 's Northwest Territories in his youth, Merv has a soft spot for the gold industry and has developed several Gold Indices reflecting different aspects of the industry. As a basically lazy individual Merv's driving focus is to KEEP IT SIMPLE .

To find out more about Merv's various Gold Indices and component stocks, please visit . There you will find samples of the Indices and their component stocks plus other publications of interest to gold investors.

Before you invest, Always check your market timing with a Qualified Professional Market Technician

Merv Burak Archive

© 2005-2019 - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.

Post Comment

Only logged in users are allowed to post comments. Register/ Log in