I still like gold, and I’m getting bullish on silver

March 21, 20224 Comments

I continue to be bullish on gold, and I have been monitoring silver for a similar bullish setup. Back in January I posted this blog noting that gold had been showing bullish momentum divergences and a very attractive technical setup for a probable upside move. I followed up in February when I posted this video suggesting that gold was setting up for a move. So you cannot say I didn’t give you plenty of heads up on golds upside potential when it was trading at $1800/oz. Since that time, gold rallied to $2100, although it has since then settled in to near $1930.

Gold still looks good

Here is the chart for gold. I’m updating the same chart with the original notations posted on my January blog noted above. Note that gold has broken the right angled triangle noted in that blog, and has maintained positive momentum divergences along with positive moneyflow (top and bottom panes). You can see the recent test of the early 2020 highs. Note that the pullback to $1930 keeps price well over its declining trendline that constructed the right angled triangle. As such, I must maintain that the breakout is still valid. All conditions remain positive for gold until proven otherwise.

Silver

In addition to gold, I am becoming more and more interested in silver as a portfolio position. The chart below is illustrating a classic sideways consolidation with a slightly rounded look, followed by a neckline breakout and a further sideways consolidation. This  looks a lot like a Cup & Handle type formation, which can be bullish. As you know, I don’t get tied up in the “name that formation” game. Call it the  Rumpelstiltskin Banana Peel Formation. It doesn’t matter. The point is, as I note in my Online Technical Analysis Course, that a consolidation breakout that is holding its neckline is a good setup. And that’s what we have here.

I do not think its unreasonable to estimate a return to the old highs in the $40-$50 area if the current consolidation lid of $30 is broken. Note that we have the same setup we saw in gold back in January. That is, a consolidation pattern. Gold was in a right angled triangle, silver is in a rectangular pattern – both are simply consolidations. Like gold back in the New Year, silver is demonstrating bullishly diverging RSI and MACD. All in, silver looks constructive. If $30 breaks, the upside is attractive. If the lower support level near $22 breaks – you have a sell signal. Very straight forward risk/reward setup as far as I am concerned.

Tools for Traders

Here is a list of educational tools and trading ideas that I am currently offering:

YouTube video’s: Much like this blog, but often covering unique topics like my recent one on rare earth metals – watch the video’s here.

Newsletter: I highly recommend subscribing to the free ValueTrend Newsletter. Clients are privy to knowing the inside scoop of our trades. The non-client version still offers much of the content that only our clients would normally receive. The only difference being the removal of individual security names. This is valuable info that you don’t necessarily get on the blog.

Online Technical Analysis Course: The system I teach is the result of over three decades of professionally trading stocks. This “school of hard-knocks”  has produced a systematic game plan that I know works. And yet – Its geared towards retail investors (that’s YOU!) — not professional traders. Right now the course is offered at $100. I am anticipating the price of this course to change significantly upwards in the coming weeks. So, you snooze you loose. That is, if you put off buying the course for too long. Here is the link.

 

4 Comments

  • I consider myself to have intermediate skill levels when it comes to stocks. I took your course. It’s one of the best $100 I have spent. Maybe that will help anybody who is considering the course and sitting on the fence.

    Reply
    • Thanks David. Spread the word. I have spoken to the promo guy and he wants to run with it- I am not sure the exact start date but it will likely be by the spring. He basically is looking at $500 for the course – so anyone new who wants it should get on it ASAP. Prior buyers like you are locked in and can continue to access it for as long as I keep the course active (at least for the balance of 2022, or longer, so you have lots of time to re-take parts of it).

      Reply
  • Would you trade physical silver like PSLV or the producers . The ETF SIL has a similar pattern but is testing the bottom of the range where as PLSV is middle range.

    Reply
    • PSLV is the purest play–and it is liquid as I understand it. I don’t want to own a producer ETF personally (but that’s me)–we bought a silver producer stock and a gold stock.

      Reply

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