In a market overrun with whipsaws and failed moves, our gold mining trades are holding their breakouts and reaching our initial targets. Not many market areas can make that claim.
Today, I outline multiple mining stocks and highlight critical levels of potential resistance for gold and silver.
In a market overrun with whipsaws and failed moves, our gold mining trades are holding their breakouts and reaching our initial targets. Not many market areas can make that claim.
And when you consider they’re outperforming the S&P 500 and the physical metals, it’s hard not to like these names.
Especially as gold and silver run into logical levels of resistance…
I'm a big fan of Phil's work. He's the Chief Market Strategist at Blue Line Futures and a market veteran with more than 20 years of experience trading futures and forex.
Today, Phil shares with us his technical perspective on precious metals and discusses key fundamental drivers at play right now.
Gold priced in USD has finally joined other global currencies, closing last week at an all-time high. Silver, the high-beta play, is outperforming its more reserved cousin (gold). And gold mining stocks are breaking out.
Many of our trade ideas over the past few weeks are working. I believe this trend has just begun and could last for months – or even quarters.
Fresh two-year highs for the Gold/SPX ratio stand out this week, as gold outperforms its alternatives. It doesn't get much more bullish than fresh absolute and relative highs.
With that as our backdrop, I had Jason Perz @JasonP138 of Against All Odds Research on the show to share his view of the precious metals space.
That’s the foundational premise of relative strength studies.
Remember, we always want to buy the strongest and sell the weakest. It sounds simple. But it’s impossible to overstate its importance.
One of the best ways to increase our probability of success is to buy assets that are trending higher on absolute terms while outperforming their alternatives.
Those are key ingredients of a strong uptrend. And it just so happens that gold checks both boxes…
Buyers taking control of a market heading into the weekend exude confidence. And Gold bugs have done it two weeks in a row now and counting, as they reclaimed the former 2011 highs.
So what’s next for precious metals?
Well, if Gold priced in other major currencies is any indication (which I think it is), it looks like new all-time highs.
Buyers taking control of a market heading into the weekend exude confidence. That describes gold bulls last Friday as they drove prices higher into the close.
To no surprise, Gold kicked off the new week gapping higher and rallying more than 2.5%. We call this bullish follow-through.
Silver is clawing its way back after breaking down from a month-long consolidation and undercutting a critical shelf of former lows.
As we talked about last week, it all comes down to risk appetite. Silver bid speaks to a healthy risk-seeking environment favoring all precious metals.
