Gold and Silver Pullbacks Look Complete

By Fan Yang,

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Gold and Silver Technical Update

March 16, 2011 - Gold and Silver in a Pullback to Test Bearish Intent

Simple Moving Average( SMA ) 200-period (bold, gray)
RSI-14 with Simple Moving Average 5-period of RSI attached.
Fibonacci Study
Elliott Wave Principles
Market and Price Action (patterns, candlesticks)
Intraday pivots and Intermediate-term support and resistance
Multiple Time-frame Analysis

Gold and Silver in Pullback to Test Bearish Intent (3/16)

Gold (XAU/USD)
Gold 3/7/2011 4H and Daily Chart

- Gold was seen yesterday in a wedge. It was noted that a break below it might not mean completion of the correction, or pullback that was occurring.
- Indeed we see another rally attempt today, which could be the second swing to complete an ABC correction.
- The bearish outlook remains a projection towards 1360-1365 area. This is a swing projection seen in the 4H chart (from around 1410).  1365 is also 161.8% projection seen in the daily chart and 1360 is 61.8% retracement. This is a cluster of support levels and should provide support to a bearish attempt.
- The bearish scenario should be confirmed if the market closes below 1380 in the 4H chart.

Silver (XAG/USD)
Silver 3/17/2011 Daily Chart
- Silver is in a similar setup as Gold as the market consolidates after a corrective decline. 35 is acting as resistance. If it breaks, the bearish scenario might have trouble. The outlook would turn more sideways with a bearish bias, instead of a bearish swing.
- A close by a 4H candle below 33.55 suggests bearish continuation in the short-term. A swing projection targets the 32 clip.
- There are some support here, but major support is near the 31.22 area. This is also near 50% retracement. Above 31.22 , we also have a pivot at 31.75. We can expect support to form in this area between 31.22 and 31.75 .

Will Gold and Silver continue their corrective declines? We would love to hear what you think. S ubscribe and become a membe r to share your views and join live discussions as well as webinars about the markets.

Fan Yang CMT
Chief Technical Strategist

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

This article appears in: Investing Commodities
Referenced Stocks: SMA

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