Gold and Silver Resuming Bear Runs

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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 (XAU/USD)
gold 5/11/2011
Short-Term to Medium-Term
- The rally from 1463 was capped at 1527, near 61.8% retracement of the entire decline we had since last week.
- The 4H chart shows a swing projection to 1415 if the market is in a zig zag mode. Note here that the RSI reading is held below 60. The reading breaking below 40 would reflect bearish continuation .
- However, if the market consolidates or congests in a triangle pattern, the decline should also catch support between 50-61.8% retracement of the rally we had this week so far (seen in the 1H chart).
- A break below the 61.8% retracement level near 1488 then suggests a test of 1463 , before targeting 1415 .

Silver (XAG/USD)
Silver 5/11/2011 Charts
Short-Term to Medium Term
- The rally in silver from 33.04 to 39.46 area covers exactly 38.2% retracement of the decline since 49.50 area.
- Silver is in a more pronounced downtrend then gold, and is more likely in a zig zag .
- However the swing to 23 suggested by a wave equality will be challenged strongly at the 31-31.20 support zone.
- Since silver has been in such a long-term rally , a conservative bearish target would be the 31-31.20 zone.
- To confirm this bearish outlook the market needs to break below 36.50 and hold below that pivot. The RSI in the 4H chart should dip back below 40.
- The market should first test 33.04 . If 33.00 breaks, look for 31 to provide support .

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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

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