Time for gold and silver?

 

Seasonally, July can often start off strong and finish its rally into about the mid-point of the month for the broad S&P 500 index (source: Thackray’s 2014 Guide). From that point, late July and August can be a bit more “iffy”, at least from a seasonal perspective. According to Thackray, August on the whole has produced a 0% average gain since 1950. However, there are always a few sectors to look at during that month for potential profits. Thackray notes agriculture, healthcare and transportation as seasonally strong candidates. I covered the transportation sector via automakers on this blog a couple of weeks ago. Now may be a good time to review the charts I discussed: https://www.valuetrend.ca/?p=2969

Using seasonal trends with technical analysis, a couple of charts worth viewing right now may those of gold and silver. Silver, as mentioned on this blog (https://www.valuetrend.ca/?p=2930) tends to set up for a rally from around this time of the year. Gold is also a good candidate for a seasonal rally, although silver has outperformed it during their mutual summer – fall rallies over the past 5 years.

I’d like to see gold break its minor resistance of $1330 before committing, but I am carefully watching this commodity for a potential buy signal.

gold

Silver, too, needs to break a minor resistance point – in this case at or near $22. Note the overbought momentum studies on both gold and silver on the near termed (daily) charts. These signals suggest a bit of softness is due before we see a bullish breakout through. But keep an eye open here. Lots of upside may be available, should these commodities break their ceilings.

silver

Keith on BNN

I’ll be on BNN’s MarketCall on Thursday July 17th, 2014 at 6:00pm. Phone in with your questions on technical analysis for Keith during the show. CALL TOLL-FREE 1-855-326-6266 and mention you read my blog! Or email your questions a few days ahead of time (specify they are for Keith) to [email protected]

6 Comments

  • Definitely getting a pull back this week so far,thanks for update Keith!

    Reply
    • Better to wait and follow a discipline than to jump in with the crowd sometimes

      Reply
  • Yes, Keith, better to follow discipline even if there’s a dollar or two left on the table.

    But when or if your discipline is met, which $GOLD and $SILVER would be your favourites?

    I had the good fortune of watching a webinar from Pring last week. They emphasized the streamers and royalty companies.

    Reply
    • Fred–silver tends to be the stronger player this time of the year, so I’ll be focusing there myself.

      Reply
  • HI KEITH,

    I AM READING THAT GOLD NEEDS $1370 TO SUGGEST HIGHER PRICES AND A BREAK UNDER $1315 WOULD BE NEGATIVE. DO YOU AGREE?

    Reply
    • A break above 1370 would be a sign of the triangle top broken–which is bullish. But gold has already broken 1315–it can stay anywhere near or above 1300 and still look to be breaking its downtrend.

      Reply

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