But, Gold is also trading near the major upper trend line which is has stayed under for the last 10 years. (Seen in previous posts). I'm looking for Gold to trade in a range between $1900 and the fibonacci 76.4 band for a short time before a breakout towards the upper trend line, possibly in latter part of Sept. Even though September has the highest return for Gold out of any month, it has made a significant run from $1478 to $1920 within 9 weeks!
Silver has a small upward wedge formation indicated by the upper and lower trend lines. This usually ends up with the price breaking either up or down through the trend line. Silver is still undervalued compared to Gold based on the 1980 price as Gold passed $850 an ounce in 2008 and Silver has yet to pass $50 and we are in the latter part of 2011! I'm looking for a break up unless the cartel wants to suppress it for the remainder of 2011...?
Based on some of the articles that I have read, JP Morgan still holds quite a bit of Silver futures contracts in the short position. I'm surprised that they did not cover the bulk of them during the last raid by the Comex that brought the price down from ~49 to ~32. Guess they know that their friends at the fed can always bail them out...
Next stop for the HUI Index is ~725 based on a fibonacci drawn from the low and high in 2010. (261.8 level is at ~725).
There is a FOMC meeting on Sept 20-21. We'll see what Ben has in store for us at that time.