Thursday, April 7, 2011

April 7th Gold Silver

Daily chart of the World Gold Index from mid February, 2011.

Gold has broken out from the previous highs around the $1440 area and is slowly gathering momentum.
Gold is trading above the short, mid and longer term moving averages.
The MACD Histogram has crossed over the mid line and is on a ascent.
The RSI in on an uptrend.
With the start of inflation seen at the gas pump and at the supermarket, more people should recognize both Gold and Silver as the best way to retain wealth. Add in the unstable financial countries in Europe, the middle east issues and China accumulating Gold and the price should have no problem going to $1500 in the near future.

Daily chart of the World Silver Index from late February, 2011.

What can you say? The price has been on the ascent and hugging the upper bollinger band, Silver is trading above all three moving averages, the Stochastics are embedded to the upside. $40 is a few cents away...

The RSI is overbought at 90.  How long will it stay in this area is anyone's guess, but it will drop down sooner or later. There should be some major resistance at the even number of $40, but with the strong demand for the undervalued metal, a rise to the $41 or $42 area before a pullback is a possibility. 

All of the pullbacks with Silver have been shallow with the exception of January, 2011. (This was after a 80% gain in 2010)  The last break low was $33.64 and when Silver does pull back, it should not take out this low. 

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