Silver and Gold Looking Bearish [SPDR Gold Trust (ETF), iShares Silver Trust (ETF)]

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June 4, 2014 10:19am NYSE:GLD NYSE:SLV

gold and silverDan Hassey: This week I’ll give you my updated thoughts on gold and silver bullion.

Bottom line: Neither looks bullish now.


The Ukrainian crisis has improved, with Russia stating they will honor Ukraine’s desire to remain independent — except for Crimea, which Russia firmly intends to keep.

Nevertheless, gold and silver weakened as fears of a longer crisis subsided.

Tensions and uncertainty remain between the two countries. More problems could certainly erupt if either side strays from the current truce.

Here is the latest weekly gold chart.

Here’s what I see in the chart:

  • Gold has been stuck in a trading range for about a year now. Support is around $1,200, and resistance is around $1,400.
  • Gold is about the same price it was a year ago.
  • Gold has a bearish declining top line. This indicates participants are selling the rallies.
  • Gold made a bottom in June 2013 on heavy selling volume.
  • Gold made a double-bottom last December on buying volume, a good bullish sign back then. Sure enough, gold staged a nice rally off the bottom.

Gold may test the trading range’s bottom again, and if it holds we could get another rally. If it doesn’t hold, look for a major sell signal.

Silver is looking weak. Will silver follow gold?


Here is the latest weekly silver chart.

Let’s review the chart:

  • The bearish declining top line dominates the current trend.
  • Silver prices are current testing support in the $19 area.
  • Volume is similar to the gold chart, with heavy selling on the first bottom and buying on the second.
  • The last two weekly bars reflect a fight between the bulls and bears. Because the overall pattern is bearish, the bears may win.

The all-in production cost for silver is about $16, so that will probably be the next support level if the bears prevail.

Neither gold nor silver will stay weak forever, but neither looks bullish right now. Be very careful before you make any new investments in either metal.

dan-hasseyThis article is brought to you courtesy of Dan Hassey

Uncommon Wisdom Daily is a free daily investment newsletter published by Weiss Research, Inc. This publication does not provide individual, customized investment or trading advice. All information is based upon data whose accuracy is deemed reliable, but not guaranteed. Performance returns cited are derived from our best estimates, but hypothetical as we do not track actual prices of customer purchases and sales. We cannot guarantee the accuracy of third party advertisements or sponsors, and these ads do not necessarily express the viewpoints of Uncommon Wisdom Daily or its editors.

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