Weekly Market Analysis: Cyclic swing is about to put pressure on Silver

As we've discussed previously, precious metals appear to be caught in a cyclic ranging pattern. In the coming weeks, Silver, in particular, will be searching for support around $US22.20 per ounce to initiate its upward cycle once again. Ideally, it will find this support before reaching that level, combining the energy from the 200-day moving average (200MDA) into the mix. Failing to find support around these prices might lead Silver into a consolidation phase around $US20-21.

Gold is currently touching its 200MDA, and it remains to be seen whether this level will provide sufficient support for its price or if it will experience a slight dip before beginning its recovery.

This ranging pattern is also reflected in the stock market, with major indexes experiencing recent pullbacks from their monthly highs. We've included the charts for the US500 and ASX200 today to illustrate the nearly mirrored movements between equities and metals. The key difference is that precious metals have fallen below their 200MDA, potentially presenting a buying opportunity.

In recent news, jobless claims in the US hit new lows, indicating market strength. However, earlier in the week, factory orders turned negative, posting a -2.1% figure.

Looking ahead to next week, we anticipate more real data on CPI, PPI, and retail sales in the US. This data will likely influence decision-making regarding additional rate hikes or whether the Federal Reserve (FED) will keep rates steady as we approach the festive trading season.

You'll find today's technical analysis and charting below for your reference. Today’s charts are shown at a slightly different angle to see these great-ranging patterns we mentioned.

Gold, with 200MDA

Silver, with 200MDA

ASX200, with 200MDA

US500 with 200MDA

Gold Futures Technical Analysis 

Gold Futures monthly analysis continues to recommend a STRONG BUY with Weekly analysis of a BUY signal.

Technical indicators - Monthly Projections

 Summary for Monthly Forecast: Strong Buy

Disclaimer

This news and any links provided are for general information only and should not be taken as constituting professional advice from Jaggards. Jaggards is not a financial adviser. We recommend you seek independent financial advice before making any financial decisions based on the information contained in this article.